SNGEETA JAIN, Jaipur V. ITO, Jaipur

ITA 718/JPR/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 5177 (ITAT-JAIPUR)
• Duration Of Justice: 10 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 29-09-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R A VERMA CIT DR DHK
• Section: 142(1); 144

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR JH HKKXPUN] YS[KK LNL; DS LE{K BEFORE: SHRI BHAGCHAND, ACCOUNTANT MEMBER VK;DJ VIHY LA-@ ITA NO. 718/JP/2015 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2007-08 SMT. SANGEETA JAIN 2014, PITALIYON KA CHOWK JOHRI BAZAR, JAIPUR CUKE VS. THE ITO WARD- 1(1) JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: ACEPJ 3318 A VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY: SHRI P.C. PARWAL, CA JKTLO DH VKSJ LS@ REVENUE BY :SHRI R.A. VERMA, ADDL CIT-. DR LQUOKBZ DH RKJH[K@ DATE OF HEARING : 09/08/2016 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 22/08/2016 VKNS'K@ ORDER PER BHAGCHAND, AM THE ASSESSEE HAS FILED AN APPEAL AGAINST THE ORDER OF THE LD. CIT(A)-1, JAIPUR DATED 24-08-2015 FOR THE ASSESSM ENT YEAR 2007-08 RAISING THEREIN FOLLOWING GROUNDS:- 1. THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW I N NOT ACCEPTING THE CONTENTION OF THE ASSESSEE THAT P ENALTY LEVIED BY THE AO U/S 271A ON THE DIRECTION OF THE L D. CIT(A) IS ILLEGAL AND BAD IN LAW SINCE THE AS PER SECTION 271A IF LD. CIT(A) IS SATISFIED THAT ASSESSEE HAS NOT MAINTAINE D BOOKS OF ACCOUNTS, ONLY LD. CIT(A) HAS THE AUTHORITY TO IMPO SE PENALTY ITA NO. 718/JP/2015 SMT. SANGEETA JAIN VS. ITO,WARD- 1(1), JAIPUR . 2 2. THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN CONFIRMING THE ACTION OF THE AO IN LEVYING PENALTY OF RS. 25,000/- U/S 271A OF THE I.T. ACT, 1961. 2.1 BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE F ILED HER RETURN OF INCOME FOR THE ASSESSMENT YEAR 2007-08 ON 31-10-200 7 DECLARING TOTAL INCOME OF RS. 1,35,892/-. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND NOTICE U/S 143(2) WAS ISSUED ALONGWITH NOTICE U/S 142(1) OF THE ACT. THE ASSESSEE DID NOT RESPOND TO THE NOTIC ES. AFTER GIVING AMPLE OPPORTUNITIES TO THE ASSESSEE, THE AO ISSUED A SHOW CAUSE NOTICE U/S 142(1) ON 23-10-2009 AS A FINAL OPPORTUNITY BEFORE FINALIZATION OF THE ASSESSMENT. THE ASSESSEE DID NOT RESPOND TO IT. THE CASE WAS COMPLETED U/S 144 OF THE ACT AT AN INCOME OF RS. 8,25,070/- B Y MAKING TRADING ADDITION OF RS. 5,13.955/- AND DISALLOWANCE OF EXP ENSES OF RS. 75,220/-. THE ASSESSEE PREFERRED FIRST APPEAL BEFORE THE LD. CIT(A) WHO VIDE HER ORDER DATED 30-01-2012 DECIDED THE APPEAL PARTLY IN FAVOUR OF THE ASSESSEE HOWEVER, THE LD. CIT(A) WHILE DECIDING THE APPEAL OF THE ASSESSEE AT PARA 6 OF HER ORDER OBSERVED AS UNDER:- ON PERUSAL OF THE DETAILS FILED BY THE APPELLANT, IT IS SEEN THAT EVEN BY HER OWN ADMISSION, SHE HAD EARNED BROKERAGE INCOME OF MORE THAN RS.1,25,000/- AND HAS NOT MAINTAINED ANY BOOKS OF ACCOUNTS IN CONTRAVENTION OF SECTION 44AA(2), PENALTY PROCEEDIN GS ARE TO BE INITIATED U/S 271A BY THE AO. ITA NO. 718/JP/2015 SMT. SANGEETA JAIN VS. ITO,WARD- 1(1), JAIPUR . 3 ON THE DIRECTION OF THE LD. CIT(A), THE AO ISSUED N OTICE DATED 01.03.2012 U/S 274 R.W.S. 271 OF THE IT ACT, 1961 INITIATING PENALTY PROCEEDINGS U/S 271A OF THE IT ACT, 1961 I.E. FAILU RE TO KEEP, MAINTAIN OR RETAIN BOOKS OF ACCOUNTS, DOCUMENTS ETC. AS REQUIRE D U/S 44AA. IN PENALTY ORDER, THE AO BY HOLDING THAT ASSESSEE HAS NOT FURN ISHED THE BOOKS OF ACCOUNTS DURING THE COURSE OF ASSESSMENT PROCEEDING S AND HIS CLAIM IN THE APPELLATE PROCEEDINGS THAT BOOKS OF ACCOUNTS MAINTA INED AND ARE NOT TRACEABLE SHOWS THAT SHE HAS NOT MAINTAINED THE REQ UIRED BOOKS EVEN THOUGH HER TURNOVER WAS RS.5,25,55.559/- BY HER OWN ADMISSION, IMPOSED PENALTY OF RS.25,000/- U/S 271A OF THE IT ACT, 1961 . 2.2 BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTE R BEFORE THE LD. CIT(A) WHO HAS CONFIRMED THE PENALTY U/S 271A OF TH E ACT. 2.3 I HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IN THIS CASE, IT IS NOT IMPERA TIVE TO REPEAT THE ISSUE AS THIS CASE IS FULLY SIMILAR TO THE CASE OF SHRI KUMU D CHAND JAIN VS. ITO WARD- 1(1), JAIPUR IN ITA NO. 716/JP/2015 FOR THE A SSESSMENT YEAR 2007- 08 IN WHICH THE LD. CIT(A) HAS GIVEN THE SAME FINDI NGS AS GIVEN IN THE CASE OF SMT. SANGEETA JAIN (SUPRA). THE BENCH HEARD THE CASE OF SHRI KUMUD CHAND JAIN VS. ITO WARD- 1(1), JAIPUR (SUPRA) WHICH HAS BEEN ITA NO. 718/JP/2015 SMT. SANGEETA JAIN VS. ITO,WARD- 1(1), JAIPUR . 4 ALLOWED IN FAVOUR OF THE ASSESSEE (SUPRA) VIDE HIS ORDER DATED 16-08- 2016 BY GIVING FOLLOWING OBSERVATIONS. 2.5 I HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IT IS OBSERVED IN TH E PRESENT CASE THAT THE ASSESSEE FURNISHED THE AUDITED ACCOUNTS BE FORE THE AO WHERE THE SALE OF RS. 9,55,23,214/- WAS DISCLOSED. BASED ON SUCH ACCOUNTS, THE AO MADE THE TRADING ADDITION BY APPLY ING GROSS PROFIT RATE OF 2% ON THE DECLARED SALE. THUS THE AO WAS SATISFIED THAT THE ASSESSEE HAD MAINTAINED BOOKS OF ACCOUNT A ND THEREFORE, HE HAD NOT INITIATED PENALTY PROCEEDINGS U/S 271A T HOUGH THE AO HAD INITIATED PENALTY PROCEEDINGS U/S 271(1), 271( B) AND 271B OF THE ACT. IN APPELLATE PROCEEDINGS, THE LD. CIT(A) R ECORDED A FINDING THAT THE ASSESSEE HAD NOT MAINTAINED ANY BOOKS OF A CCOUNT AND EARNED BROKERAGE INCOME OF MORE THAN RS. 1,25,000/- LACS AND THUS PENALTY PROCEEDINGS U/S 271A IS TO BE INITIATED BY THE AO. TAKING INTO CONSIDERATION ALL THE ASPECTS OF THE ISSUE IN QUESTION, IT IS OBSERVED THAT THE ASSESSEE HAS SUBMITTED THE COPY O F AUDITED ACCOUNTS BEFORE THE AO BUT THE ASSESSEE COULD NOT PRODUCE THE BOOKS OF ACCOUNT DUE TO LOSS OF THE SAME. IN SUCH A SITUATION, PENALTY IMPOSED U/S 271A FOR NON-MAINTENANCE OF BOO KS OF ACCOUNT DESERVES TO BE DELETED AND THUS PENALTY IS NOT LEVI ABLE. HENCE, THE APPEAL OF THE ASSESSEE IS ALLOWED. 2.4 IN VIEW OF THE ABOVE DELIBERATIONS AND CONSIDER ING THE SAME FACTS AND CIRCUMSTANCES OF THE CASE OF ASSESSEE WITH THE CASE OF SHRI KUMUD CHAND JAIN VS. ITO WARD- 1(1), JAIPUR (SUPRA), THE PENALTY CONFIRMED BY THE LD. CIT(A) IS DIRECTED TO BE DELETED. HENCE, TH IS APPEAL OF THE ASSESSEE IS ALLOWED. ITA NO. 718/JP/2015 SMT. SANGEETA JAIN VS. ITO,WARD- 1(1), JAIPUR . 5 3.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 22/08/2016 SD/- HKKXPUN ( BHAGCHAND) YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 22/08/ 2016 *MISHRA VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SMT. SANGEETA JAIN, JAIPUR 2. IZR;FKHZ@ THE RESPONDENT- THE ITO, WARD- 1 (1), JAIPUR 3. VK;DJ VK;QDRVIHY@ CIT(A). 4. VK;DJ VK;QDR@ CIT, 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO. 718/JP/2015) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ @ ASSISTANT. REGISTRAR