Hariom Oil Industries, Baroda V. The ACIT.,Cent.Circle-1, Baroda

ITA 687/AHD/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 73153 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-03-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 18-03-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 22-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P L KUREEL
• Keywords: Opportunity of being heard; Reasonable cause; Revised return

Judgement Text

, , , , , , , , IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH B BENCH, AHMEDABAD .., ! ! ! ! ' #$, BEFORE SHRI N.S. SAINI, ACCOUNTANT MEMBER AND SHRI KUL BHARAT, JUDICIAL MEMBER !./ I.T.A. NO.687/AHD/2012 ( & '& & '& & '& & '& / / / / ASSESSMENT YEAR : 2007-08) M/S.HARIOM OIL INDUSTRIES STATION ROAD PAVI JETPUR DIST.BARODA GUJARAT 391 160 / VS. THE ACIT CENTRAL CIRCLE-1 BARODA ( !./)* !./ PAN/GIR NO. : AACFM 8025 B ( (+ / // / APPELLANT ) .. ( ,-(+ / RESPONDENT ) (+ . / APPELLANT BY : SHRI MUKUND BAKSHI, AR ,-(+ / . / RESPONDENT BY : SHRI P.L. KUREEL, SR.DR ' 0 / $1 / / / / DATE OF HEARING : 18/03/2014 23' / $1 / DATE OF PRONOUNCEMENT : 31/03/2014 4 / O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE LD.COMMISSIONER OF INCOME TAX(APPEALS)-IV, AHMEDABA D (CIT(A) FOR SHORT) DATED 10/02/2011 PERTAINING TO ASSESSME NT YEAR (AY) 2007- 08. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- 1. THE LD. CIT(A), AHMEDABAD, HAS ERRED IN FACTS AND I N LAW IN CONFIRMING THE PENALTY IMPOSED U/S.271(1)(C) OF THE ACT OF RS.2,70,000/- IN RESPECT OF THE INCOME OF RS.8,00,0 00/- DISCLOSED DURING THE COURSE OF SEARCH PROCEEDINGS, WHICH WAS ITA NO.687/AHD/ 2012 M/S.HARIOM OIL INDUSTRIES VS. ACIT ASST.YEAR 2007-08 - 2 - OFFERED FOR TAXATION IN THE REVISED RETURN OF INCOM E. THUS, THE PENALTY OF RS.2,70,000/- IS PRAYED TO BE CANCELLED. 2. THE APPELLANT CRAVES LIBERTY TO ADD, ALTER, AMEND, REVISE, DELETE OR SUBSTITUTE ANY OF THE GROUNDS OF APPEAL CONTAINE D HEREINABOVE. 2. BRIEFLY STATED FACTS ARE THAT A SEARCH ACTION U/ S.132 OF THE I.T.ACT WAS CARRIED OUT IN THE CASE OF M/S.HARIOM GROUP OF CASES ON 31.05.2006 COVERING THE BUSINESS AND RESIDENTIAL PREMISES. SU BSEQUENTLY, THE ASSESSMENT U/S.143(3) OF THE INCOME TAX ACT,1961 (H EREINAFTER REFERRED TO AS THE ACT) WAS FRAMED VIDE ORDER DATED 31/12/ 2008, THEREBY THE AO MADE ADDITION ON ACCOUNT OF UNACCOUNTED STOCK AMOUN TING TO RS.68,472/- AND INCOME EARNED FROM UNACCOUNTED SOURCES AMOUNTIN G TO RS.7,31,528/-. WHILE FRAMING ASSESSMENT, THE AO OB SERVED THAT ON 23/12/2008 ASSESSEE-FIRM HAS FIELD ITS REVISED RETU RN OF INCOME DECLARING TOTAL INCOME AT RS.10,08,230/-. THE AO INITIATED T HE PENALTY PROCEEDINGS U/S.271(1)(C) OF THE ACT AND A PENALTY OF RS.2,70,0 00/- WAS LEVIED. AGAINST THIS, THE ASSESSEE FILED AN APPEAL BEFORE T HE LD.CIT(A), WHO DISMISSED THE APPEAL. NOW, THE ASSESSEE IS IN FURT HER APPEAL BEFORE US. 3. THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT A SEARCH TOOK PLACE ON 31/05/2006. HE SUBMITTED THAT ADVANCE TAX PAID ON 15/06/2006 AMOUNTING TO RS.2,69,500/-. HE SUBMITTED THAT TH E INCOME-TAX RETURN U/S.139(1) OF THE ACT ON 29/10/2007 AND REVISED RET URN U/S.139(5) OF THE ACT WAS FILED ON 23/12/2008. HE SUBMITTED THAT AS PER ORIGINAL RETURN, THE TOTAL INCOME WAS DECLARED AT RS.2,08,228/- AND AS PER REVISED RETURN THE INCOME WAS DECLARED AT RS.10,08,228/-. HE SUBM ITTED THAT IN ORIGINAL ITA NO.687/AHD/ 2012 M/S.HARIOM OIL INDUSTRIES VS. ACIT ASST.YEAR 2007-08 - 3 - RETURN, INADVERTENTLY THE ADVANCE TAX PAID AMOUNTIN G TO RS.2,69,500/- WAS NOT CLAIMED, HOWEVER, IN REVISED RETURN, IT WA S CLAIMED. HE FURTHER SUBMITTED THAT THE LD.CIT(A) FAILED TO CONSIDER THE WRITTEN SUBMISSIONS MADE BEFORE HIM. HE HAS PLACED ON RECORD THE WRITT EN SUBMISSIONS MADE BEFORE THE LD.CIT(A). 4. ON THE CONTRARY, D.SR.DR SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. HE SUBMITTED THAT THE ASSESSEE COULD NOT GI VE SATISFACTORY EXPLANATION AND, THEREFORE, THE AUTHORITIES BELOW W ERE JUSTIFIED IN IMPOSING THE PENALTY. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. WE FIND THAT THE LD.CIT(A) HAS DECIDED THIS ISSUE V IDE PARA-2.1 OF HIS ORDER, BY OBSERVING AS UNDER:- 2.1. IT IS EVIDENT FROM RECORD THAT NO EXPLANATION WAS MADE BEFORE THE ASSESSING OFFICER EVEN AFTER SHOW CAUSE NOTICE ISSUED AND SERVED AND SUFFICIENT TIME WAS ALSO ALLOWED TO COMPLY WITH SUCH SHOW CAUSE NOTICE. APPARENTLY, THE APPELLANT HAD NOT COMPLIED WITH THE TERMS OF CLAUSE (A) OF EXPLANATIO N 1 TO SEC.271(1)(C) OF THE ACT AND THEREFORE, THE INCOME OF RS.8,00,000/- DISCLOSED DURING THE COURSE OF SEARCH AND ADDED TO THE TOTAL INCOME ON ACCOUNT OF REVISED RETURN OF THE APPELLAN T WILL REPRESENT THE INCOME IN RESPECT OF WHICH PARTICULARS HAVE BEE N CONCEALED. HOWEVER, NEITHER ANY EXPLANATION WAS FURNISHED BEFO RE THE ASSESSING OFFICER IN COMPLIANCE TO THE SHOW CAUSE N OTICE ISSUED NOR ANY REASONS WERE GIVEN AS TO WHY THE SHOW CAUSE NOTICE OF THE ASSESSING OFFICER WAS NOT COMPLIED WITH. IF THE A PPELLANT WOULD HAVE BEEN PREVENTED BY ANY REASONABLE CAUSE FOR THE NON- COMPLIANCE OF THE SHOW CAUSE NOTICE OF THE ASSESSIN G OFFICER AND ITA NO.687/AHD/ 2012 M/S.HARIOM OIL INDUSTRIES VS. ACIT ASST.YEAR 2007-08 - 4 - SUCH REASONABLE CAUSE WAS BROUGHT ON RECORD DURING THE COURSE OF APPELLATE PROCEEDINGS, THE EXPLANATION FURNISHED BY THE LD.COUNSEL COULD HAVE BEEN ACCEPTABLE AFTER GIVING THE OPPORTUNITY OF BEING HEARD TO THE ASSESSING OFFICE R. HOWEVER, THE LD.COUNSEL OF THE APPELLANT HAD FAILED TO FURNISH A NY REASONABLE CAUSE DURING APPELLATE PROCEEDINGS FOR THE NON-COMP LIANCE OF THE SHOW CAUSE NOTICE OF THE ASSESSING OFFICER. UNDER SUCH CIRCUMSTANCES, IT IS HELD THAT THE APPELLANT WAS NO T PREVENTED BY ANY REASONABLE CAUSE TO COMPLY WITH THE SHOW CAUSE NOTICE ISSUED BY ASSESSING OFFICER. THE APPELLANT ON ACCOUNT OF NEGLIGENCE HAD NOT FURNISHED ANY EXPLANATION IN COMPLIANCE TO THE SHOW CAUSE NOTICE OF THE ASSESSING OFFICER. THEREFORE, THE AS SESSING OFFICER WAS JUSTIFIED IN IMPOSING THE PENALTY U/S.271(1)(C) OF THE ACT FOR CONCEALING THE PARTICULARS OF INCOME TO THE EXTENT OF RS.8,00,000/-. THE PENALTY SO LEVIED FOR RS.2,70,000/- IS HEREBY C ONFIRMED. THE FIRST GROUND OF APPEAL IS ACCORDINGLY DISMISSED. 5.1. THE GRIEVANCE OF THE ASSESSEE IS THAT A DETAIL ED WRITTEN SUBMISSION WAS FILED BEFORE THE LD.CIT(A), WHO HAS NOT CONSIDE RED THE SAME AND THE CASE-LAWS AS RELIED UPON BY THE ASSESSEE. AFTER CO NSIDERING THE SUBMISSIONS AND THE MATERIAL AVAILABLE ON RECORD, W E FIND THAT THE LD.CIT(A) HAS NOT CONSIDERED THE WRITTEN SUBMISSION S AND GIVEN ANY FINDING IN RESPECT OF THE CASE-LAWS AS RELIED UPON BY THE ASSESSEE. THEREFORE, THE ORDER OF THE LD.CIT(A) IS HEREBY SET ASIDE AND THE ISSUE IS RESTORED BACK TO HIS FILE FOR FRESH DECISION. THE LD.CIT(A) IS HEREBY DIRECTED TO VERIFY THE CONTENTS OF THE SUBMISSION M ADE BY THE ASSESSEE AND ALSO CONSIDER THE CASE-LAWS AS RELIED UPON BY T HE ASSESSEE AND DECIDE THE MATTER AFRESH IN ACCORDANCE WITH LAW. THUS, TH IS GROUND OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES ONLY. ITA NO.687/AHD/ 2012 M/S.HARIOM OIL INDUSTRIES VS. ACIT ASST.YEAR 2007-08 - 5 - 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED BUT FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN COURT ON THE DATE MENTIONED HER EINABOVE AT CAPTION PAGE SD/- SD/- ( .. ) (' #$) ( N.S. SAINI ) ( KUL BHARAT ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 31/ 03 /2014 71.., .../ T.C. NAIR, SR. PS 4 / ,$8 98'$ 4 / ,$8 98'$ 4 / ,$8 98'$ 4 / ,$8 98'$/ COPY OF THE ORDER FORWARDED TO : 1. (+ / THE APPELLANT 2. ,-(+ / THE RESPONDENT. 3. !! $ ': / CONCERNED CIT 4. ':() / THE CIT(A)-IV, AHMEDABAD 5. 8 #; ,$ , , / DR, ITAT, AHMEDABAD 6. ;<& =0 / GUARD FILE. 4' 4' 4' 4' / BY ORDER, -8$ ,$ //TRUE COPY // > >> >/ // / !) !) !) !) ( DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 18.3.14(DICTATION-PAD 7-PAG ES ATTACHED AT THE END OF THIS FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 19.3.14 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 5. DATE ON WHICH FAIR ORDER PLACED BEFORE OTHER MEMBER 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.31.3.14 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 31.3.13 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER