Rajni Goel, Yamunanagar V. ITO, Yamunanagar

ITA 719/CHANDI/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 73414 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 6 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-01-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 15-01-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 29-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J S NAGAR

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH B CHANDIGARH BEFORE SHRI T.R.SOOD ACCOUNTANT MEMBER AND MS. SUSHMA CHOWLA, JUDICIAL MEMBER ITA NOS.719/CHD/2012 ASSESSMENT YEAR : 2009-10 SMT. RAJNI GOEL, VS THE INCOME TAX OFFICER, 489, SAROJINI COLONY, WARD 2, YAMUNA NAGAR. YAMUNA NAGAR. PAN : ABEPG4385K (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI TEJ MOHAN SINGH RESPONDENT BY : SHRI J.S.NAGAR DATE OF HEARING : 20.02.2014 DATE OF PRONOUNCEMENT : 25.02.2014 O R D E R PER SUSHMA CHOWLA, JM THE APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) PANCHKULA DATE D 16.05.2012 RELATING TO ASSESSMENT YEAR 2009-10 AGAINST THE PEN ALTY ORDER PASSED UNDER SECTION 271A OF THE INCOME-TAX ACT, 1961 ( 'T HE ACT' FOR SHORT). 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE REA D AS UNDER : 1. THE AUTHORITIES BELOW HAVE GROSSLY ERRED ON FACTS, IN LAW AND UNDER CIRCUMSTANCES OF THE CASE IN PASSING, APPROVING & S USTAINING THE PENALTY ORDER U/S 271A ALLEGEDLY FOR NON-MAINTENANC E OF BOOKS OF ACCOUNTS U/S 44AA WHEN THERE WAS NO DEFAULT. THE HY POTHETICAL ORDERS PASSED BY THE ASSESSING OFFICER AND THE CIT( A) DESERVES TO BE QUASHED AB INITIO. 2. THE AUTHORITIES BELOW ARE NOT JUSTIFIED IN PASSING AND SUSTAINING THE PENALTY ORDER ON SURMISES AND CONJECTURES BY NOT CO NSIDERING THE SUBMISSIONS OF THE APPELLANT AS A WHOLE. 3. THE LD. CIT(A) IS NOT JUSTIFIED IN SUSTAINI NG THE PENALTY ORDER ALLEGING THAT BANK DETAILS WERE NOT FURNISHED. 4. THE LD. CIT(A) IS NOT JUSTIFIED IN SUSTAINING THE P ENALTY WHEN BOOKS OF ACCOUNTS WERE MAINTAINED AND PRODUCED AS DESIRED . 2 5. THE LD. CIT(A) IS ABSOLUTELY WRONG IN STATING TH AT THE ASSESSEE FAILED TO APPEAR ON THE APPOINTED DATE. 3. THE ONLY ISSUE RAISED IN THE PRESENT APPEAL IS A GAINST PENALTY LEVIED UNDER SECTION 271A OF THE ACT AT RS. 25,000/ -. 4. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E FOR THE YEAR UNDER CONSIDERATION HAD FILED RETURN OF INCOME DECL ARING TOTAL INCOME OF RS. 1,80,630/-. THE ASSESSEE HAD DECLARED INCOM E FROM BUSINESS AT RS.1,77,000/- AND ALSO HAD DECLARED INCOME FROM TUI TION. THE ASSESSING OFFICER WAS OF THE VIEW THAT THE ASSESSEE WAS LIABLE TO KEEP AND MAINTAIN BOOKS OF ACCOUNT UNDER SECTION 44A OF THE ACT. AS PER THE ASSESSING OFFICER, THE ASSESSEE HAD FAILED TO M AINTAIN THE BOOKS OF ACCOUNT AND AS SUCH PENALTY PROCEEDINGS UNDER SE CTION 271A OF THE ACT WERE ATTRACTED. THE PLEA OF THE ASSESSEE BEFOR E THE ASSESSING OFFICER WAS THAT IT WAS MAINTAINING PROPER BOOKS OF ACCOUNT AND IT WAS NOT CORRECT TO STATE THAT PERUSAL OF THE RETURN OF INCOME REFLECTS THAT IT WAS NOT MAINTAINING BOOKS OF ACCOUNT. THE A SSESSING OFFICER NOTED THAT IN THE COLUMN WHERE THE ASSESSEE HAD TO STATE WHETHER SHE WAS LIABLE TO MAINTAIN ACCOUNTS AS PER SECTION 44AA OF THE ACT, THE REPLY HAS BEEN GIVEN AS NEGATIVE. CONSEQUENTLY, THE ASSESSING OFFICER LEVIED PENALTY UNDER SECTION 271A OF THE AC T AT RS. 25.000/-. 5. THE COMMISSIONER OF INCOME TAX (APPEALS) UPHELD THE LEVY OF PENALTY AS THE CASE OF THE ASSESSEE FELL UNDER SECT ION 44A(2)(I) OF THE ACT. SINCE THE ASSESSEE HAD FAILED TO COMPLY WITH THE REQUISITE REQUIREMENTS OF THE SECTION, ASSESSEE WAS HELD TO B E LIABLE TO THE LEVY OF PENALTY UNDER SECTION 271A OF THE ACT. 6. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF T HE COMMISSIONER OF INCOME TAX (APPEALS). 3 7. THE LD. AR FOR THE ASSESSEE POINTED OUT THAT THE ASSESSEE HAD FURNISHED WRITTEN SUBMISSIONS BEFORE THE COMMISSION ER OF INCOME TAX (APPEALS) WHICH ARE PLACED AT PAGES 1 TO 4 OF THE P APER BOOK WHICH HAVE NOT BEEN CONSIDERED BY THE COMMISSIONER OF INCOME T AX (APPEALS). IT WAS FURTHER POINTED OUT BY THE LD. AR FOR THE ASSES SEE THAT THERE WAS NO LIABILITY UPON THE ASSESSEE TO MAINTAIN BOOKS OF AC COUNT FOR THE YEAR UNDER CONSIDERATION AS THE RECEIPT FOR THE PRECEDIN G THREE YEARS IN THE HANDS OF THE ASSESSEE WERE BELOW THE PRESCRIBED LIM ITS. HOWEVER, THE ASSESSEE HAD MAINTAINED BOOKS OF ACCOUNT WHICH THE ASSESSEE IS READY TO PRODUCE BEFORE ANY OF THE AUTHORITIES. IT WAS FURT HER EXPLAINED BY THE LD. AR FOR THE ASSESSEE THAT TICKING THE BOX NO TO TH E QUESTION WHETHER SHE WAS REQUIRED TO MAINTAIN BOOKS OF ACCOUNT ? DOES NOT IMPLY THAT THE ASSESSEE HAD NOT MAINTAINED THE BOOKS OF ACCOUN T. ADMITTEDLY, THE ASSESSEE WAS NOT REQUIRED TO MAINTAIN THE BOOKS OF ACCOUNT. HOWEVER, THE SAME WERE MAINTAINED BY THE ASSESSEE. 8. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ISSUE ARISING IN THE PRESENT APPEAL IS IN RELATION TO LEVY OF PENALTY UNDER SECTION 271A OF THE ACT. THE SAID PROVISIONS OF THE ACT ARE APPLICABLE WHERE THE ASSESSEE HAS FAILED TO KEEP, MAINTAIN OR RETAIN THE BOOKS OF ACCOUNT OR DOCUMENTS WHICH AN ASSESSEE IS REQUIRED TO KEEP AND MAINTAIN UNDER SECTION 44AA OF THE ACT OR THE RULES MADE THE REUNDER. IN CASE OF FAILURE OF THE ASSESSEE TO MAINTAIN SUCH BOOKS OF A CCOUNT OR DOCUMENTS AS REQUIRED UNDER SECTION 44AA OF THE ACT, THEN THE ASSESSING OFFICER OR THE COMMISSIONER OF INCOME TAX (APPEALS) MAY DIRECT SUCH PERSON TO PAY PENALTY OF A SUM OF RS. 25,000/-. 9. NOW COMING TO THE PROVISIONS OF SECTION 44AA OF THE ACT. SUB- SECTION (1) DEALS WITH VARIOUS CLASSES OF PROFESSIO N AND THE REQUIREMENT OF MAINTAINING THE BOOKS OF ACCOUNT AND DOCUMENTS A S PROVIDED UNDER 4 THE ACT. SUB-SECTION (2) TO SECTION 44A OF THE ACT PROVIDES THAT WHERE A PERSON IS CARRYING ON BUSINESS OR PROFESSION, NOT B EING PROFESSION REFERRED TO IN SUB-SECTION (1), SHALL, WHERE HIS IN COME FROM BUSINESS OR PROFESSION EXCEEDS RS. 1,20,000/- OR THE TOTAL SALE S, TURNOVER OR GROSS RECEIPTS EXCEED RS. 10,00,000/- IN ANY OF THE THREE YEARS IMMEDIATELY PRECEDING TO PREVIOUS YEAR, THEN SUCH PERSONS ARE R EQUIRED TO MAINTAIN THE BOOKS OF ACCOUNT AS PROVIDED UNDER SUB-CLAUSE ( I) TO SECTION 44AA(2) OF THE ACT. THE OTHER CLAUSES UNDER THE SUB-SECTIO N ARE NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE. SO, WE RESTRICT OUR DECISION VIS--VIS SUB- CLAUSE (I) TO SECTION 44AA(2) OF THE ACT. 10. THE ASSESSEE HAS FILED WRITTEN SUBMISSIONS BEFO RE THE ASSESSING OFFICER WHICH ARE PLACED AT PAGES 1 TO 12 OF THE PA PER BOOK IN WHICH IT HAD CATEGORICALLY REPORTED THAT IN ASSESSMENT YEARS 2006-07 AND 2007-08, THE GROSS RECEIPTS EARNED BY THE ASSESSEE WERE NIL AND IN ASSESSMENT YEAR 2008-09, THE TOTAL GROSS RECEIPTS WERE RS. 9,0 00/-. THE ASSESSEE HAS ALSO FURNISHED ON RECORD COPY OF THE COMPUTATION OF INCOME, BALANCE SHEET AND CAPITAL ACCOUNT AS ON 31.3.2006, 31.3.200 7 AND 31.3.2008 AT PAGES 32 TO 40 OF THE PAPER BOOK IN WHICH THE SAID STAND OF THE ASSESSEE IS ALSO PROVED. THE YEAR UNDER APPEAL BEFORE US IS ASSESSMENT YEAR 2009- 10. IN THE THREE ASSESSMENT YEARS PRECEDING THE AS SESSMENT YEAR 2009- 10, THE GROSS RECEIPTS OF THE ASSESSEE FROM BUSINES S OR PROFESSION WERE BELOW PRESCRIBED LIMITS AND EVEN THE INCOME FROM BU SINESS OR PROFESSION WAS BELOW PRESCRIBED LIMIT AS PROVIDED UNDER CLAUSE (I) TO SECTION 44AA(2) OF THE ACT. IN OTHER WORDS, THE ASSESSEE W AS NOT OBLIGED TO MAINTAIN THE BOOKS OF ACCOUNT FOR THE YEAR UNDER CO NSIDERATION. HOWEVER, THE ASSESSEE CLAIMS THAT IT HAD MAINTAINED THE BOOKS OF ACCOUNT AND THE SAME WERE AVAILABLE WITH HIM. MERELY BECAU SE THE ASSESSEE HAD ANSWERED IN NEGATIVE TO THE QUESTION, WHETHER THE A SSESSEE WAS LIABLE TO MAINTAIN BOOKS OF ACCOUNT IN THE RETURN OF INCOME, DOES NOT ESTABLISH 5 THAT THE ASSESSEE HAD NOT MAINTAINED THE BOOKS OF A CCOUNT. THE PLEA OF THE ASSESSEE IN THIS REGARD WAS THAT UNDER THE PROV ISIONS OF THE ACT SHE WAS NOT LIABLE TO MAINTAIN THE BOOKS OF ACCOUNT. H OWEVER, THE SAME HAD BEEN MAINTAINED IN DUE COURSE OF CARRYING ON THE BU SINESS FOR THE YEAR UNDER CONSIDERATION. IN THE TOTALITY OF THE ABOVES AID FACTS AND CIRCUMSTANCES, WE FIND NO MERIT IN THE LEVY OF PENA LTY UNDER SECTION 271A OF THE ACT. WE DIRECT THE ASSESSING OFFICER T O DELETE PENALTY LEVIED UNDER SECTION 271A OF THE ACT. THE GROUNDS O F APPEAL RAISED BY THE ASSESSEE ARE THUS, ALLOWED. 11. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED IN THE OPEN COURT ON 25 TH FEBRUARY,2014. SD/- SD/- ( T.R.SOOD) (SUSHMA CHOWLA) ACCOUNTANT MEMBER J UDICIAL MEMBER DATED: 25 TH FEBRUARY,2014 POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR. ASSISTANT REGISTRAR ITAT,CHD.