ITO, Barnala V. Sh. Iqbal Singh, Barnala

ITA 728/CHANDI/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 63984 (ITAT-CHANDIGARH)
• Duration Of Justice: 3 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-10-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2004-2005
• Appeal Filed On: 06-07-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUDHIR SEHGAL
• Assessee Lawyers: ASHOK KHANNA
• Keywords: Period of limitation; Time period of passing order
• Section: 27; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH A, CHANDIGARH BEFORE MS. SUSHMA CHOWLA, JUDICIAL MEMBER AND SHRI MEHAR SINGH, ACCOUNTANT MEMBER ITA NO.728/CHD/2012 (ASSESSMENT YEAR : 2004-05) THE INCOME TAX OFFICER, VS. IQBAL SINGH, BARNALA. S/O SH.GURDEV SINGH, VILL. CHHANNA GULAB SINGH WALA, BARNALA. PAN: - AND C.O.NO.27/CHD/2012 ARISING OUT OF ITA NO.728/CHD/2012 (ASSESSMENT YEAR : 2004-05) IQBAL SINGH, VS. THE INCOME TAX OFFICER, S/O SH.GURDEV SINGH, BARNALA. VILL. CHHANNA GULAB SINGH WALA, BARNALA. PAN: - (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SUDHIR SEHGAL RESPONDENT BY : SHRI ASHOK KHANNA, DR DATE OF HEARING : 01.10.2012 DATE OF PRONOUNCEMENT : 17.10.2012 O R D E R PER SUSHMA CHOWLA, J.M, : THE APPEAL FILED BY THE REVENUE IS AGAINST THE ORD ER OF THE COMMISSIONER OF INCOME-TAX(APPEALS), PATIALA DATED 18.05.2012 RELATING TO ASSESSMENT YEAR 2004-05 AGAINST THE PENALTY LEVI ED U/S 271(1)(C) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). THE ASSESSEE HAS FILED CROSS OBJECTIONS AGAINST THE APPEAL FILED BY THE RE VENUE. 2 2. BOTH THE APPEAL OF THE REVENUE AND THE CROSS OBJ ECTIONS FILED BY THE ASSESSEE ON THE SIMILAR ISSUE WERE HEARD TOGETH ER AND ARE BEING DISPOSED OFF BY THIS CONSOLIDATED ORDER FOR THE SAK E OF CONVENIENCE. 3. THE REVENUE IN ITA NO.728/CHD/2012 HAS RAISED FO LLOWING GROUNDS OF APPEAL: 1. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD.CIT(A) HAS ERRED IN DELETING THE PENALTY OF RS.6,94,660/- IMPOSED U/S 271(1)(C) OF THE I.T. ACT WITHOUT APPRECIATING THAT WHEN THE ASSESSMENT WAS SET-ASIDE BY THE ITAT, PENALTY PROCEEDINGS INITIATED ON 11.12.2006 AUTOMATICALLY STOOD FILED. 2. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD.CIT(A) HAS FURTHER ERRED IN DELETING THE PENALTY IMPOSED AS THE TIME LIMITATION HAS TO BE CALCULATED, AS PER CLAUSE (A) OF SUB SECTION (1) OF SECTION 275 OF I.T. ACT, AFTER THE EXPIRY OF THE FINANCIAL YEAR IN WHICH THE PROCEEDINGS, IN THE COURSE OF WHICH ACTION FOR THE IMPOSITION OF PENALTY HAS BEEN INITIATED, ARE COMPLETED, OR SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE ORDER OF ITAT IS RECEIVED BY CIT, WHICHEVER, PERIOD EXPIRES LATER. 4. THE ISSUE RAISED IN THE PRESENT APPEAL FILED BY THE REVENUE IS AGAINST DELETION OF PENALTY LEVIED U/S 271(1)(C) OF THE ACT. THE LEARNED A.R. FOR THE ASSESSEE AT THE OUTSET POINTED OUT THA T THE ISSUE IN THE PRESENT APPEAL FILED BY THE REVENUE IS IDENTICAL TO THE ISSUE RAISED IN THE CASE OF THE OTHER CONNECTED PERSONS AND THE TRIBUNA L VIDE ORDER DATED 18.10.2010 HAD HELD THE PENALTY LEVIED TO BE BEYOND THE LIMITATION PERIOD PRESCRIBED UNDER THE STATUTE. 5. THE LEARNED D.R. FOR THE REVENUE PLACED RELIANCE ON THE ORDER OF THE ASSESSING OFFICER. HOWEVER, IT WAS FAIRLY ADMI TTED BY THE LEARNED D.R. FOR THE REVENUE THAT THE APPEAL WAS DECIDED BY THE CIT (APPEALS) FOLLOWING THE ORDER OF THE TRIBUNAL. 3 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ASSESSMENT IN THE CASE OF THE ASSESSEE WAS COMPLETE D UNDER SECTION 144 OF THE ACT ON 11.12.2006, AGAINST WHICH THE ASSESSE E PREFERRED AN APPEAL BEFORE THE CIT (APPEALS), PATIALA, WHO VIDE ORDER D ATED 20.12.2007 DISMISSED THE APPEAL OF THE ASSESSEE. THE TRIBUNAL PARTLY ALLOWED THE APPEAL OF THE ASSESSEE VIDE ORDER DATED 31.12.2008. THE ASSESSING OFFICER WHILE COMPLETING THE ASSESSMENT PROCEEDINGS UNDER SECTION 144 OF THE ACT HAD INITIATED PENALTY PROCEEDINGS U/S 27 1(1)(C) OF THE ACT ON 11.12.2006. THEREAFTER THE ASSESSING OFFICER AGAIN STARTED THE PENALTY PROCEEDINGS ON 24.12.2009 AFTER GIVING EFFECT TO TH E ORDER OF THE TRIBUNAL AND IMPOSED PENALTY OF RS.6,94,660/- VIDE ORDER DATED 22.6.2010. THE CONTENTION OF THE ASSESSEE IN THIS REGARD WAS THAT THE PENALTY PROCEEDINGS HAD BECOME TIME BARRED ON 31.3. 2009 AND THE ORDER IMPOSING THE PENALTY DATED 22.6.2010 U/S 271(1)(C) OF THE ACT WAS TIME BARRED. THE CIT (APPEALS) NOTED THE FACT THAT SIMI LAR ISSUE AROSE BEFORE THE TRIBUNAL IN THE CASE OF S/SHRI JASBIR SINGH, KA RTAR SINGH AND AVTAR SINGH AND VIDE ORDER DATED 18.10.2010 IN ITA NOS.69 4, 695 & 292/CHD/2010 THE TRIBUNAL HAD HELD THE PENALTY U/S 271(1)(C) OF THE ACT TO BE LEVIED BEYOND THE LIMITATION PRESCRIBED UNDER THE STATUTE FOR LEVY OF PENALTY. THE OBSERVATIONS OF THE TRIBUNAL VIDE PARAS 6 TO 8 ADJUDICATING THE ISSUE RAISED IN THE SAID APPEALS H AS BEEN REPRODUCED BY THE CIT (APPEALS) AT PAGES 4 TO 6 OF THE APPELLATE ORDER. ADMITTEDLY THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACT S ARISING IN THE SAID ORDER PASSED BY THE TRIBUNAL AND THE CIT (APPEALS) HAS OBSERVED SO. THE CIT (APPEALS) DELETED THE PENALTY LEVIED U/S 27 1(1)(C) IN VIEW THE ASSESSING OFFICER HAVING ISSUED NOTICE FOR STARTING PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT ON 13.2.2008 AND THUS ADMI TTEDLY THE ORDER OF 4 THE CIT (APPEALS) AGAINST QUANTIFYING ADDITION WAS RECEIVED BEFORE 31.3.2008, THUS THE PENALTY PROCEEDINGS BECAME TIME BARRED BY 31.3.2009. THE PENALTY LEVIED U/S 271(1)(C) OF THE ACT WAS THUS DELETED BY THE CIT (APPEALS). 7. WE FIND THAT THE LEARNED D.R. FOR THE REVENUE FO R THE REVENUE HAS FAILED TO CONTROVERT THE FINDINGS OF THE CIT (APPEA LS). IN THE FACTS OF THE PRESENT CASE THE ORDER OF ASSESSMENT WAS PASSED ON 11.12.2006 AND THE PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT WE RE ALSO INITIATED ON 11.12.2006. THEREAFTER THE ORDER OF THE CIT (APPEA LS) WAS PASSED ON 20.12.2007 AND THE ASSESSING OFFICER HAD ISSUED SHO W CAUSE NOTICE FOR LEVY OF PENALTY ON 13.2.2008 I.E. THE ORDER OF CIT (APPEALS) WAS RECEIVED BY THE ASSESSING OFFICER BEFORE 31.3.2008 . CONSEQUENTLY, PERIOD OF LIMITATION FOR LEVYING PENALTY U/S 271(1) (C) OF THE ACT WAS UP TO 31.3.2009. THE PRESENT ORDER OF LEVY OF PENALTY U/S 271(1)(C) OF THE ACT WAS PASSED BY THE ASSESSING OFFICER FOR 22.6.20 10 I.E. BEYOND THE PERIOD PRESCRIBED UNDER THE STATUTE. THE FACTS OF THE PRESENT CASE ARE IDENTICAL TO THE FACTS BEFORE THE TRIBUNAL (SUPRA) AND FOLLOWING THE ORDER OF THE TRIBUNAL VIDE PARAS 6 TO 8 OF THE ORDER DATE D 18.10.2010 WE UPHOLD THE ORDER OF THE CIT (APPEALS) IN HOLDING TH AT THE PENALTY LEVIED U/S 271(1)(C) OF THE ACT HAVE BEEN COMPLETED BEYOND THE PERIOD OF LIMITATION AND HENCE THE SAME ARE TO BE SET ASIDE. THE RELEVANT PORTION OF ORDER OF TRIBUNAL IS REPRODUCED BY CIT (APPEALS) AND THE SAME IS NOT BEING REPRODUCED FOR THE SAKE OF BREVITY. WE UPHOL D THE ORDER OF THE CIT (APPEALS) IN DIRECTING THE ASSESSING OFFICER TO DELETE THE PENALTY LEVIED U/S 271(1)(C) OF THE ACT. THUS GROUNDS OF A PPEAL RAISED BY THE REVENUE IN THIS REGARD ARE DISMISSED. 8. THE LEARNED A.R. FOR THE ASSESSEE HAS WITHDRAWN THE CROSS OBJECTIONS FILED AGAINST THE APPEAL FILED BY THE RE VENUE. CONSEQUENTLY, 5 THE SAME ARE DISMISSED AS WITHDRAWN. 9. IN THE RESULT, BOTH THE APPEAL OF THE REVENUE AN D THE CROSS OBJECTIONS FILED BY THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 17 TH DAY OF OCTOBER, 2012. SD/- SD/- (MEHAR SINGH) (SUSHMA CHOWLA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 17 TH OCTOBER, 2012 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH