Arti Sharma, Panchkula V. ITO, W-1, Panchkula

ITA 7/CHANDI/2019

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 9485 (ITAT-CHANDIGARH)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 02-01-2019
• Court: TRIBUNAL

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH SMC CHANDIGARH !', # BEFORE: SMT. DIVA SINGH, JM ./ ITA NO. 7/CHD/2019 / ASSESSMENT YEAR : 2008-09 MS. ARTI SHARMA, HOUSE NO. 422, SECTOR-7, PANCHKULA. VS THE ITO, WARD -1, PANCHKULA. ./ PAN NO: AXXPS8084Q / APPELLANT / RESPONDENT ! ' / ASSESSEE BY : SHRI PARIKSHIT AGGARWAL, CA # ! ' / REVENUE BY : SHRI MANJIT SINGH, CIT-DR $ % ! &/ DATE OF HEARING : 12.09.2019 '()* ! &/ D ATE OF PRONOUNCEMENT : 23.09.2019 $%/ ORDER THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE WHEREIN THE CORRECTNESS OF THE ORDER DATED 16.10.20 18 OF CIT(A), PANCHKULA PERTAINING TO 2008-09 ASSESSMENT YEAR IS ASSAILED ON THE FOLLOWING GROUNDS: 1. THAT THE ORDER OF THE LD. CIT (A), PANCHKULA IS BAD AGAINST THE FACTS AND LAW. 2. THAT ON LAW, FACTS AND CIRCUMSTANCES OF THE CASE, L D. CIT (A), PANCHKULA HAS ERRED IN LEVYING PENALTY U/S 271(L)(C) OF THE ACT O F RS.72630/ BY HOLDING THAT THE ASSESSEE FAILED TO FURNISH THE RETURN OF INCOME DESPITE THE FACT THAT THE ASSESSEE HAD DULY FILED THE RETURN IN RESPONSE TO N OTICE U/S 148 ON 21.08.2015. 3. THAT ON LAW, FACTS AND CIRCUMSTANCES OF THE CASE, L D. CIT (A), PANCHKULA HAS ERRED IN LEVYING PENALTY U/S 271(1) (C) OF THE ACT OF RS.72630/ DESPITE THE FACT ITA 7/CHD/2019 A.Y. 2008-09 PAGE 2 OF 8 THAT THERE WAS NO ADDITION (EXCEPT THE DISALLOWANCE OF RS.33330/- U/S 80C) TO THE RETURNED INCOME OF THE ASSESSEE. 4. THAT ON LAW, FACTS AND CIRCUMSTANCES OF THE CASE, L D. CIT (A), PANCHKULA HAS ERRED IN LEVYING PENALTY U/S 271(L)(C) OF THE ACT O F RS.72630/ DESPITE THE FACT THAT ALL THE TAXES DUE WERE ALREADY PAID BEFORE THE ISSUE OF NOTICE U/S 148. 5. THAT THE APPELLANT CRAVES LEAVE FOR ANY AD DITION, DELETION OR AMENDMENT IN THE GROUNDS OF APPEAL ON OR BEFORE THE DISPOSAL OF THE SAME. 2. THE LD. AR INVITING ATTENTION TO THE ASSESSMENT ORDER PARAS 1 AND 2 SUBMITTED THAT THERE IS NO DOUBT THAT THE ASSESSEE IN THE YEAR UNDER CONSIDERATION DID NOT FI LE ITS RETURN WITHIN TIME AS STIPULATED IN SECTION 139(1). THE ASSESSEE, IT WAS SUBMITTED, AS PER THE TIME MANDATE D BY THE STATUTE SHOULD HAVE FILED ITS RETURN ON OR BEFORE 3 1.07.2008. THE RETURN, IT WAS AGREED HAD BEEN FILED BEYOND THI S DATE AND HAD INFACT BEEN FILED ON 07.11.2012 DECLARING N ET TAXABLE INCOME OF RS. 3,83,380/-. IT WAS SUBMITTED THAT THIS RETURN FILED AFTER PAYING ALL DUE TAXES AND SELF AS SESSMENT TAX WAS TREATED AS NON-EST AS IT WAS BEYOND TIME. I T WAS HIS SUBMISSION THAT THE ASSESSEE IS NOT AGGRIEVED BY TH IS. THE GRIEVANCE OF THE ASSESSEE IS LEVY OF PENALTY U/S 27 1(1)(C) OF THE ACT. ADDRESSING THE FACTS, IT WAS HIS SUBMISSI ON RETURN FILED WAS VOLUNTARY WITH ALL DUE TAXES ETC. PAID. THE SAME RETURN WAS REFILLED, ONLY ADDITION WAS DISALLOWANCE OF LIC PREMIUM WHICH WAS NOT SUPPORTED BY EVIDENCE. ADDIT ION WAS ACCEPTED AS LOOKING AT THE ADDITION OF RS. 33,285/- . APPEAL, IT WAS CONSIDERED WOULD BE EXPENSIVE. IN THESE FAC TS HIS ITA 7/CHD/2019 A.Y. 2008-09 PAGE 3 OF 8 ARGUMENTS WERE TWO FOLD. FIRSTLY THAT THERE WAS AN EXPLANATION OFFERED FOR THE DELAY. NAMELY THAT BY MISTAKE THE RETURN HAD NOT BEEN FILED. THE FACT OF NON-FILI NG OF RETURN WAS NOTICED ONLY IN THE SCRUTINY PROCEEDINGS OF 200 7-08 WHICH WERE UNDER WAY IN NOVEMBER, 2012 AND THE ASSE SSEE PROMPTLY REALIZING THIS FACT VOLUNTARILY ADDRESSED THIS INADVERTENT BONAFIDE MISTAKE WHICH OCCURRED DUE TO OVERSIGHT. THE RETURN FILED VOLUNTARILY WAS COMPLE TE BY PAYING FULL TAXES ON THE RETURNED INCOME ALONGWITH SELF ASSESSMENT TAX ETC. UPTO THAT DATE. FOR THE SAID P URPOSE, ATTENTION WAS INVITED TO PAPER BOOK PAGE 4 WHICH, I T WAS SUBMITTED, WOULD DEMONSTRATE THAT ON THE STATED RET URNED INCOME, TAX OF RS. 99,682/- INCLUSIVE OF TDS AND SE LF ASSESSED TAX STOOD PAID. THE SECOND ARGUMENT WAS T HAT THE VERY SAME RETURN WAS REFILLED IN RESPONSE TO NOTICE U/S 148 ISSUED TO THE ASSESSEE ON 27.03.2015. REFERRING TO THE REASONS RECORDED AT PAGES 2 AND 3, IT WAS HIS SUBMI SSION THAT NO ADDITION WAS MADE ON THE BASIS OF THESE. R EADING FROM THE ASSESSMENT ORDER AND THE ORIGINAL RETURN F ILED WHICH HAD BEEN TREATED AS NON-EST PAGE 6 OF THE ASS ESSMENT ORDER AND PAGE 4 OF THE PAPER BOOK, IT WAS HIS SUBM ISSION THAT APART FROM ADDITION BY WAY OF DISALLOWANCE OF LIC PREMIUM OF RS. 33,285/-, THERE WAS NO ADDITION. IN BOTH THE RETURNS, GROSS INCOME OF RS. 4,16,713/- WAS SHOWN F ROM THE ITA 7/CHD/2019 A.Y. 2008-09 PAGE 4 OF 8 VERY SAME SOURCES AND NET INCOME, WAS CLAIMED AS RS . 3,83,383/-. APART FROM DISALLOWING THE CLAIM FOR LI C, NO OTHER ADDITION WAS MAINTAINED BY THE AO. IN THE SA ID CIRCUMSTANCES, IT WAS HIS SUBMISSION THAT THE SECTI ON HAS BEEN WRONGLY INVOKED. 2.1 ADDRESSING THE EVIDENCE OF PAYMENT OF PREMIUM O F RS. 33,285/-, IT WAS HIS SUBMISSION THAT THE SAID RECEI PT HAD BEEN MISPLACED AS A RESULT OF THIS FACT, ADDITION W AS ACCEPTED. IT WAS HIS SUBMISSION THAT THE LIC PREMI UM IS BEING PAID BY THE ASSESSEE EVERY YEAR BUT FOR THE S PECIFIC YEAR UNDER CONSIDERATION, THE RECEIPT WAS MISPLACED . THE ADDITION HAS BEEN ACCEPTED. 2.2 IN THESE CIRCUMSTANCES, IT WAS HIS SUBMISSION T HAT PENALTY NEITHER FOR CONCEALMENT NOR FOR FILING OF I NACCURATE PARTICULARS WAS ATTRACTED. IT WAS ALSO HIS SUBMISS ION ON QUERY THAT THIS IS THE FIRST TIME THAT THE ASSESSEE HAS BEEN VISITED BY ANY PENALTY AND THE ASSESSEE IS NOT A HA BITUAL DEFAULTER. RELYING UPON THE NATURE OF THE ADDITION AND THE FACTS ON ACCOUNT OF WHICH THE ASSESSEE VOLUNTARILY FILED THE RETURN IN NOVEMBER,2012 WHERE NOTICE U/S 148 HAD BE EN ISSUED IN MARCH, 2015, IT WAS SUBMITTED THAT THE PE NALTY IMPOSED ACCEPTING THE EXPLANATION MAY BE QUASHED. ITA 7/CHD/2019 A.Y. 2008-09 PAGE 5 OF 8 3. THE LD. CIT-DR MR. M.SINGH RELYING UPON THE ORDE RS OF THE AUTHORITIES SUBMITTED THAT ADMITTEDLY IN THE FA CTS OF THE PRESENT CASE THE RETURN FILED BY THE ASSESSEE HAS B EEN TREATED AS NON-EST AS IT WAS NOT FILED WITHIN THE T IME STIPULATED UNDER THE ACT. THE SUBMISSION THAT THE RETURN WAS FILED VOLUNTARILY WAS NOT DISPUTED BY THE LD. C IT-DR. HOWEVER, IT WAS HIS SUBMISSION THAT SINCE THE RETUR N FILED WAS NON-EST, THE OCCASION TO ARGUE THAT IT WAS A VO LUNTARY RETURN WAS NOT RELEVANT. ON QUERY ADDRESSING THE A RGUMENT THAT NO ADDITION WAS MADE ON THE BASIS OF RECORDED REASONS, HE AGREED, IS NOT DISPUTED. SIMILARLY, THE FACT THA T THE RETURN HAD BEEN FILED IN 2012 MUCH PRIOR TO THE ISSUANCE O F NOTICES WHICH AS PER THE ASSESSMENT ORDER WAS 27.03.2015, I T WAS SUBMITTED, ON QUERY WAS A MATTER OF FACT, HOWEVER I T WAS ARGUED IT WAS NOT RELEVANT. THE FACT THAT THE VERY SAME NON- EST RETURN OF INCOME WAS RE-FILED FROM THE VERY SAM E SOURCES OF INCOME AS DISCLOSED IN PURSUANCE TO THE NOTICE U /S 148 ON QUERY WAS ALSO NOT DISPUTED BY THE LD. CIT-DR. THE LD. CIT- DR ALSO DID NOT REBUT THE SUBMISSION THAT ASSESSEE WAS NOT A HABITUAL DEFAULTER, HOWEVER, HEAVY RELIANCE WAS P LACED UPON THE ORDERS OF THE AUTHORITIES BELOW. IT WAS H IS SUBMISSION THAT THE NON-EST RETURN CANNOT BE THE BA SIS OF THE ARGUMENTS FOR QUASHING THE PENALTY ORDER. ITA 7/CHD/2019 A.Y. 2008-09 PAGE 6 OF 8 4. I HAVE HEARD THE SUBMISSIONS AND PERUSED THE MA TERIAL ON RECORD. ADMITTEDLY IN THE FACTS OF THE PRESENT CASE THE ASSESSEE FAILED TO FILE ITS RETURN WITHIN THE TIME AS STIPULATED IN THE STATUTE. THE RETURN FILED BY THE ASSESSEE W AS ADMITTEDLY LATE AND ON FACTS THAT THE RETURN HAS BE EN TREATED AS NON-EST IS NOT DISPUTED BY THE ASSESSEE ALONE. IN THE FACTS OF THE PRESENT CASE THE ASSESSEE IS CHALLENGI NG THE ORDER OF THE CIT(A) WHEREIN THE PENALTY IMPOSED U/S 271(1)(C) OF THE ACT FOR CONCEALMENT HAS BEEN UPHEL D BY THE ASSESSING OFFICER. 5. IN THE FACTS AS ARGUED AND AVAILABLE ON RECORD, THE ASSESSEE HAS PLEADED INADVERTENT MISTAKE BY WAY OF AN OVERSIGHT FOR NON FILING OF THE RETURN WITHIN THE S TATUTORY TIME LIMIT. IN THE FACTS OF THE PRESENT CASE AS HA S BEEN VARIOUSLY NOTICED THE AO ISSUED NOTICE U/S 148 IN M ARCH, 2015 AND RETURN FROM THE VERY SAME SOURCES OF INCOM E STOOD ALREADY FILED ON 7.11.2012 WHEREIN THE TDS AND SELF ASSESSMENT TAX UPTO THE SAID DATE STOOD PAID. IT I S ALSO A FACT PLEADED ON RECORD THAT THE ASSESSEE IS NOT A H ABITUAL DEFAULTER AND THIS IS ONE AND ONLY TIME WHEREIN PEN ALTY U/S 271(1)(C) OF THE ACT OR ANY OTHER PENALTY HAS BEEN VISITED UPON THE ASSESSEE. WHEN A COPY OF THE RETURN FILED ON 7.11.2012 WHICH HAS BEEN TREATED AS NON-EST IS COMP ARED WITH THE ASSESSED INCOME AS AVAILABLE IN ASSESSMENT ORDER ITA 7/CHD/2019 A.Y. 2008-09 PAGE 7 OF 8 DATED 18.1.2016 PASSED U/S 143(3)/148 OF THE ACT, I T IS SEEN THAT THE ONLY ADDITION MADE IS ADDITION BY WAY OF A DISALLOWANCE OF DEDUCTION U/S 80C OF INSURANCE PREMIUM AMOUNTING TO RS. 33,285/-. IN THE SAID BACKGROUND, IN ORDER TO UPHO LD THE PENALTY ORDER, THE REVENUE WOULD WANT TO ARGUE THAT THE EXP LANATION FOR FILING OF THE RETURN LATE WAS NOT ON ACCOUNT OF A B ONAFIDE INADVERTENT MISTAKE. NO EVIDENCE OR ARGUMENT TO SU PPORT SUCH A PRAYER IS ON RECORD. THE FACT THAT THE LATE FILING OF RETURN ON 07.11.2012 WAS BEYOND TIME, HENCE NON-EST IS NOT IN DISPUTE. THE FACT THAT THE VERY SAME RETURN FROM THE SAME SO URCES HAS BEEN REFILLED IN RESPONSE TO NOTICE U/S 148 IN MARC H, 2015 IS NOT IN DISPUTE. THERE IS NOTHING ON RECORD TO SHOW THA T THE ASSESSEE HAD, AS OPPOSED TO AN INADVERTENT MISTAKE, ANY REAS ON TO CONCEAL AS THE VERY SAME RETURN HAS BEEN REFILLED WITH NO C HANGES OR ADDITIONS. THUS, THE ARGUMENTS ON BEHALF OF THE RE VENUE THAT WITHOUT THE ISSUANCE OF NOTICE U/S 148 IN MARCH, 20 15, THE ASSESSEE WOULD NOT HAVE FILED ITS RETURN IN THE PEC ULIAR FACTS CANNOT BE ACCEPTED. THE ASSESSEE HAS FILED ITS RET URN ON 7.11.2012. IT CANNOT BE WISHED AWAY. NO DOUBT TH E SAID RETURN IS NOT A VALID RETURN IN THE EYES OF LAW, HOWEVER, IT IS A NECESSARY EVIDENCE TO BE TAKEN INTO CONSIDERATION FOR EXAMINI NG THE ARGUMENT WHETHER THE NON FILING OF A VALID RETURN W AS A CASE OF BONAFIDE, INADVERTENT MISTAKE OR DELIBERATE ACT OF CONCEALMENT OR FURNISHING OF INACCURATE PARTICULARS. THE FACT THA T THE AO HAS ITA 7/CHD/2019 A.Y. 2008-09 PAGE 8 OF 8 ACCEPTED THE RETURN FROM THE VERY SAME SOURCES OF I NCOME AND HAS ONLY MADE THE ADDITION BY WAY OF A DISALLOWANCE OF DEDUCTION U/S 80C SUPPORTS THE CONSISTENT ARGUMENT. IN THESE FACT S, I FIND MYSELF UNABLE TO UPHOLD THE ORDER WHEREIN THE PENALTY FOR CONCEALMENT HAS BEEN LEVIED AND UPHELD. ACCEPTING THE EXPLANATION OF THE ASSESSEE WHO IS ALSO NOT A HABITUAL DEFAULTER, I AGREE THAT IN THE FACTS OF THE PRESENT CASE, THE NON-FILING OF RETURN ON TIME WAS ON ACCOUNT OF INADVERTENT BONAFIDE MISTAKE AND ACCEPTING ADDITION WHERE THE FILING OF APPEAL WAS MORE EXPENSIVE IS A VALID EXPLANATION CONSISTENTLY ON RECORD. ACCORDINGLY, I AM OF THE VIEW THAT IN THE PECULIAR FACTS AND CIRCUMSTANCES OF THE PRESENT CASE, THE PENALTY PROV ISIONS ARE NOT ATTRACTED. ACCEPTING THE EXPLANATION OFFERED, THE P ENALTY IS DIRECTED TO BE QUASHED FOR THE DETAILED REASONS SET OUT HERE INABOVE. SAID ORDER WAS PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ITSELF. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 23 RD SEPT.,2019. SD/- ( !' ) (DIVA SINGH) # / JUDICIAL MEMBER