Sh. Mukesh Dhir, Parwanoo V. DCIT, Chandigarh

ITA 711/CHANDI/2014

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9775 (ITAT-CHANDIGARH)
• Duration Of Justice: 7 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-04-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 08-04-2015
• Assessment Year: 2002-2003
• Appeal Filed On: 11-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Keywords: Reasonable cause

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH A CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI T.R.SOOD, ACCOUNTANT MEMBER ITA NOS. 711 TO 717/CHD/2014 A.Y. 2002-03 TO 2008-09 SHRI MUKESH DHIR, VS THE DCIT, # 52,SECTOR 4, CENTRAL CIRCLE 1 PARWANOO. CHANDIGARH. PAN: AEKPD6163K (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI TEJ MOHAN SINGH RESPONDENT BY : SHRI S.K.MITTAL DATE OF HEARING : 08.04.2015 DATE OF PRONOUNCEMENT : 10.04.2015 O R D E R PER BHAVNESH SAINI,JM ALL THE APPEALS BY THE SAME ASSESSEE ARE DIRECTED AGAINST THE COMMON ORDER OF LD. CIT(APPEALS), GURGA ON DATED 30.05.2014 FOR ASSESSMENT YEARS 2002-03 TO ASSESSMENT YEAR 2008-09 CHALLENGING THE LEVY OF PEN ALTY UNDER SECTION 271A OF THE INCOME TAX ACT. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSES SEE DERIVES INCOME FROM HIS PROPRIETORY CONCERN M/S SOL VEX ENTERPRISES. SEARCH WAS CONDUCTED ON 18.12.2009. D URING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS 2 ASKED TO PRODUCE THE BOOKS OF ACCOUNT AND RELEVANT BILLS AND VOUCHERS IN SUPPORT OF FIGURES OF SALES AND PUR CHASES AND EXPENSES DEBITED AND DECLARED IN HIS PROFIT & L OSS ACCOUNT. IT WAS SUBMITTED BEFORE THE ASSESSING OFF ICER THAT FIGURES WERE DECLARED ON THE BASIS OF BOOKS OF ACCO UNT MAINTAINED BY HIM. HOWEVER, LATER ON THESE BOOKS W ERE DESTROYED IN FIRE ACCIDENT WHICH TOOK PLACE IN FACT ORY PREMISES ON 03.03.2009. IN SUPPORT OF HIS CLAIM, A SSESSEE FILED COPY OF THE CERTIFICATE FROM FIRE STATION, PA RWANOO MENTIONING THAT THE RECORDS OF THE ASSESSEE WERE DE STROYED IN FIRE ACCIDENT ON 03.03.2009. IT WAS, HOWEVER, F OUND THAT NO FIR HAD BEEN LODGED WITH THE CONCERNED POLICE ST ATION AND NO CLAIM IS MADE FROM THE INSURANCE COMPANIES A LSO. THE ASSESSING OFFICER WAS NOT SATISFIED WITH THE RE PLY OF THE ASSESSEE AND IMPOSED PENALTY UNDER SECTION 271A OF THE ACT. THE LD. CIT(APPEALS) ALSO CONFIRMED THE PENAL TY. 3. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT IN THE IDENTICAL CASE OF MRS. KIRAN DHIR, ITAT CHANDIGARH BENCH IN ITA NOS. 1038 & 1039/CHD/2014 HAS CANCELLED THE SIM ILAR PENALTY FOR ASSESSMENT YEAR 2007-08 AND 2008-09 VID E ORDER DATED 10.02.2015. COPY OF THE ORDER IS PLACED ON R ECORD AND WAS ALSO SUPPLIED TO THE LD. DR. 4. ON CONSIDERATION OF THE RIVAL SUBMISSIONS, WE AR E OF THE VIEW THAT ISSUE IS COVERED IN FAVOUR OF THE ASS ESSEE BY ORDER OF ITAT CHANDIGARH BENCH IN THE CASE OF MRS. KIRAN DHIR (SUPRA) IN WHICH ON IDENTICAL FACTS THE PENALT Y HAS BEEN 3 CANCELLED. THE FINDINGS OF THE TRIBUNAL IN PARA 3 TO 8 OF THE ORDER DATED 10.02.2015 ARE REPRODUCED AS UNDER : 3. AFTER HEARING BOTH THE PARTIES WE FIND THAT DURING THE ASSESSMENT PROCEEDING ASSESSEE WAS ASKED TO PRODUCE THE BOOKS OF ACCOUNTS. IN RESPONSE IT WAS STATED THAT BOOKS HAVE BEEN DESTROYED IN A FIRE ACCIDENT ON 03/03/2009, THEREFORE DUE TO NON PRODUCTION OF BOOKS PENALTY PROCEEDINGS WERE INITIATED UNDER SECTION 271A. DURING THE PENALTY PROCEEDINGS IN RESPONSE TO THE SHOW CAUSE NOTICE IT WAS AGAIN STATED THAT BOOKS OF ACCOUNTS WERE DESTROYED IN A FIRE ACCIDENT WHICH HAPPENED IN THE FACTORY PREMISES ON 03/03/2009. AO AFTER PERUSING THIS REPLY OBSERVED THAT IT WAS NOT CLEAR FROM THE CERTIFICATE ISSUED BY THE FIRE DEPARTMENT WHETHER FIRE WAS THERE IN THE GODOWN OR IN THE OFFICE AND THEREFORE IT WAS IMPROBABLE THAT BOOKS HAVE BEEN DESTROYED IN SUCH ACCIDENT. ACCORDINGLY HE LEVIED A PENALTY OF RS. 25,000/- UNDER SECTION 271A. 4. ON APPEAL THE LD. CIT(A) CONFIRMED THE ACTION OF THE AO. 5. BEFORE US LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE AO AND CIT(A). HE ALSO FILED A COPY OF THE CERTIFICATE ISS UED BY THE FIRE STATION, PARWANOO 6. ON THE OTHER HAND LD. DR SUPPORTED THE ORDER OF CIT(A). 7. AFTER CONSIDERING THE RIVAL SUBMISSIONS WE FIND THAT CERTIFICATE ISSUED BY THE FIRE DEPARTMENT CLEARLY MENTIONS THAT RECORDS OF THE COMPANY WERE DESTROYED IN THE FIRE. THEREFORE IN OUR OPINION THI S IS 4 A REASONABLE CAUSE FOR NON PRODUCTION OF BOOKS OF ACCOUNT AND ACCORDINGLY WE DELETE THE PENALTY. 8. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED. 5. FOLLOWING THE ABOVE ORDER ON THE SAME FACTS, WE SET ASIDE THE ORDERS OF AUTHORITIES BELOW AND DELETE TH E PENALTY IN ALL THE ASSESSMENT YEARS. 6. IN THE RESULT, ALL THE APPEALS OF ASSESSEE ARE A LLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 10 TH APRIL, 2015. SD/- SD/- (T.R.SOOD) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 10 TH APRIL,2015. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR, ITAT CHANDIGARH