Food Corporation of India, Sitapur V. Joint Commissioner of Income Tax, Bareilly

ITA 744/LKW/2014

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9129 (ITAT-LUCKNOW)
• Duration Of Justice: 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 09-12-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 24-09-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P K DEY
• Keywords: Opportunity of being heard

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.744/LKW/2014 ASSESSMENT YEAR:2007 - 08 JT. C.I.T. (TDS), BAREILLY. VS FOOD CORPORATION OF INDIA, DISTRICT OFFICE, 140 - B, LOHAR BAGH, SITAPUR. PAN:AAACF0365N (RESPONDENT) (APPELLANT) SHRI R. N. SHUKLA, ADVOCATE APPELLANT BY SHRI P. K. DEY, D. R. RESPONDENT BY 09/12/2014 DATE OF HEARING 23 /01/2015 DATE OF PRONOUNCEMENT O R D E R PER A. K. GARODIA, A.M. THIS IS AN ASSESSEES APPEAL DIRECTED AGAINST THE ORDER PASSED BY LEARNED CIT(A), BAREILLY DATED 03/06/2014 FOR THE ASSESSMENT YEAR 2007 - 2008. 2. IN THIS APPEAL THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS: 1. BECAUSE THE IMPUGNED ORDER SUFFERS FROM MATERIAL IRREGULARITY OF LAW AS WELL AS OF FACTS. 2. BECAUSE THE IMPUGNED ORDER IS CONTRARY TO PROVISIONS OF SECTION 271C OF INCOME TAX ACT 1961. 3. BECAUSE THE ASSESSING AUTHORITY DID NOT TAKE ANY ACTION AS DIRECT ED BY THE FIRST APPELLATE AUTHORITY IN ITS ORDER DATED 14.12.2012 PASSED AGAINST THE APPEAL OF ORIGINAL ORDER UNDER SECTION 201(1)/201(1A) DATED 20.02.2011 AND ILLEGALLY PROCEEDED TO INITIATE PENALTY PROCEEDINGS UNDER SECTION 271C OF INCOME TAX ACT 1961. 2 4. BECAUSE THE PENALTY U/S 271C OF INCOME TAX ACT 1961 CANNOT BE LEVIED FOR THE MISTAKES APPEARED IN THE ETDS RETURN AND WHICH HAS BEEN RECTIFIED AFTER FILING CORRECTION STATEMENT OF ETDS. 5. BECAUSE IN CIT VS ELI LILLY & CO.. THE APEX COURT HELD THAT, 'T HE LIABILITY TO LEVY PENALTY CAN BE FASTENED ONLY ON THE PERSON WHO DOES NOT HAVE GOOD AND SUFFICIENT REASON FOR NOT DEDUCTING TAX AT SOURCE.', BUT IN THE INSTANT CASE WHOLE OF THE TAX HAS BEEN DEDUCTED AS PER LAW AND THE ETDS RETURN HAS BEEN FILED AND THE DEFAULTS HAS BEEN CORRECTED BY FILING CORRECTION STATEMENT AND COURT BELOW FAIL TO POINT OUT THE AMOUNT OF PAYMENT ON WHICH TAX HAS NOT BEEN DEDUCTED. 6. BECAUSE THE VERY BASIS OF PENALTY U/S 271C IS THE AMOUNT OF TAX WHICH SUCH PERSON FAILED TO DEDUCT O R PAY AS PER LAW AND WHEN THERE IS NO SUCH AMOUNT IN EXISTENCE, IMPOSING PENALTY UNDER SECTION 271C IS ILLEGAL. 7. BECAUSE THERE IS NO SHORT DEDUCTION OF TAX AND WHOLE OF THE TAX OF RS.3,31,723.00 HAD BEEN DEDUCTED AND DEPOSITED INTO CENTRAL GOVERNMENT AC COUNT AS PRESCRIBED. 8. WITHOUT PREJUDICE TO ABOVE GROUNDS - BECAUSE PENALTY U/S 271C CANNOT BE GREATER THAN THE AMOUNT OF TAX WHICH A PERSON FAIL TO DEDUCT. 3. IT WAS SUBMITTED BY LEARNED A.R. OF THE ASSESSEE THAT FOR THE FINANCIAL YEAR 2006 - 07 , CONSOL IDATED FILE FOR CORRECTION WERE NOT AVAILABLE AND HENCE , THE ASSESSEE WROTE A LETTER TO THE CONCERNED AUTHORITY ON 11/12/2012 FOR OBTAINING THE CONSOLIDATED FILE AND THEREAFTER FILED THE CORRECTION STATEMENT. HE FURTHER SUBMITTED THAT PENALTY WAS IMPOSED BY INCOME TAX OFFICER (TDS), BAREILLY VIDE ORDER DATED 17/03/2013 WITHOUT TAKING INTO CONSIDERATION THE REPLY OF THE ASSESSEE AND WITHOUT POINTING OUT ANY PAYMENT ON WHICH TAX HAD NOT BEEN DEDUCTED. HE ALSO SUBMITTED THAT CIT(A) HAS NOT CONSIDERED FULL FA CTS IN PROPER PERSPECTIVE AND THEREFORE, MATTER MAY BE RESTORED BACK TO HIS FILE FOR FRESH DECISION. CONSIDERING THE FACTS OF THE PRESENT CASE, WE FIND IT FIT AND PROPER THAT IN THE INTEREST OF JUSTICE, THE MATTER SHOULD GO TO CIT(A) FOR 3 FRESH DECISION AF TER CONSIDERING ALL THE ASPECTS OF THE MATTER. ACCORDINGLY, WE SET ASIDE THE ORDER OF CIT(A) AND RESTORE THE MATTER BACK TO HIS FILE FOR FRESH DECISION. HE SHOULD ALSO PASS NECESSARY ORDER AS PER LAW AFTER ALLOWING REASONABLE OPPORTUNITY OF BEING HEARD T O BOTH THE SIDES. 4. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 23 /01/2015 *C.L.SINGH COPY OF THE ORDER FORWARDED TO : 1.THE APPELLANT 2.THE RESPONDENT. 3.CONCERNED CIT 4.THE CIT(A) 5.D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR