DIAMONDSTAR EXPORTS LTD, MUMBAI V. ITO WD 8(1)(3), MUMBAI

ITA 761/MUM/2012

• Counselvise Citation: 76119914 RSA 2012
• Duration Of Justice: 1 year(s) 8 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-10-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 03-06-2013
• Assessment Year: 2009-2010
• Appeal Filed On: 03-02-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SALMAN KHAN
• Assessee Lawyers: K K VED
• Keywords: Opportunity of being heard; Reasonable cause
• Section: 139

Judgement Text

, INCOME TAX APPELLATE TRIBUNAL,MUMBAI - D BENCH. . .. . . .. . , ,, , !'# !'# !'# !'# , ' ' ' ' BEFORE S/SH. I.P. BANSAL,JUDICIAL MEMBER & RAJENDRA ,ACCOUNTANT MEMBER /. ITA NO.761/MUM/2012 , $ $ $ $ % % % % / ASSESSMENT YEAR-2009-10 DIAMONDSTAR EXPORTS LTD. 16 MHADA SHOPPIN COMPLEX, JOGESHWARI(W) MUMBAI- 400102 VS. ITO WD 8(1)(3) AAYAKAR BHAVAN, M.K.ROAD, MUMBAI-400020 PAN:AAACV1830A ( &' / APPELLANT) ( ()&' / RESPONDENT) &' &' &' &' * * * * ' '' ' / APPELLANT BY : SHRI K.K.VED ()&' + * ' / RESPONDENT BY : SHRI SALMAN KHAN $ $ $ $ + ++ + , , , , / DATE OF HEARING : 16-09-2013 -.% + , / DATE OF PRONOUNCEMENT : 04-10-2013 $ $ $ $ , 1961 + ++ + 254(1) ' '' ' ,/, ,/, ,/, ,/, '0 '0 '0 '0 ORDER U/S.254(1)OF THE INCOME-TAX ACT,1961(ACT) PER RAJENDRA, AM FOLLOWING GROUNDS OF APPEAL HAVE BEEN FILED BY THE ASSESSEE AGAINST THE ORDER DATED 11-11-2011 OF THE CIT(A)-16,MUMBAI: 1:O RE.: LEVY OF PENALTY U/S. 221(1) R.W.S. 140A(3) : 1:1 THE COMMISSIONER OF INCOME-TAX (APPEALS) HAS ER RED IN CONFIRMING THE ACTION OF THE ASSESSING OFFIC ER OF LEVYING A PENALTY U/S. 221(1) R.W.S. 140A(3) OF THE INCOME-TAX ACT, 1961 ON THE APPELLANT. 1:2 THE COMMISSIONER OF INCOME-TAX (APPEALS) HAS ER RED IN NOT CONSIDERING THE FACT THAT THE APPELLANT WAS NOT PROVIDED ANY OPPORTUNITY OF BEING HEARD AS REQU IRED IN TERMS OF FIRST PROVISO TO SECTION 221(1) BEFORE THE LEVY OF PENALTY U/S.221(1) R.W.S. 140A(3 ). 1:3 THE APPELLANT SUBMITS THAT CONSIDERING THE FACT S AND CIRCUMSTANCES OF ITS CASE AND THE LAW PREVAIL ING ON THE SUBJECT NO PENALTY WHATSOEVER CAN BE LEVIED ON IT U/S. 221(1) R.W.S. 140A(3) OF THE INCOME-TAX ACT, 1961 AND THE COMMISSIONER OF INCOME-TAX (APPEA LS) OUGHT TO HAVE HELD AS SUCH. 1:4 THE APPELLANT SUBMITS THAT THE IMPUGNED ORDER L EVYING PENALTY U/S. 221(1) R.W.S. 140A(3) OF THE INCOME-TAX ACT, 1961 BE STRUCK DOWN. 2:0 RE : GENERAL: 2:1 THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND , SUBSTITUTE AND/OR MODIFY IN ANY MANNER WHATSOEVER ALL OR ANY OF THE FOREGOING GROUNDS OF APPEAL AT OR BEF ORE THE HEARING OF THE APPEAL. BRIEF FACTS OF THE CASE: 2 ITA NO.761/MUM/2012 DIAMONDSTAR EXPORTS LTD. 2. ASSESSEE FILED ITS RETURN OF INCOME ON 30.09.2009,D ECLARING INCOME OF RS. NIL.IT COMPUTED LIABILITY ON ACCOUNT OF SELF-ASSESSMENT TAX (SAT) AT RS. 10.7 0 LACS.ASSESSING OFFICER (AO) FOUND THAT SAT WAS NOT PAID BEFORE FILING OF RETURN OF INCOME U/S.139( 1) OF THE ACT. HE ISSUED A LETTER DATED 20.01.2010 TO THE ASSESSEE AND DIRECTED TO FURNISH PHOTOCOPY/(IES )OF THE CHALLANS EVIDENCING THE PAYMENT OF SAT. ASSESSEE,VIDE ITS LETTER DATED 27.01.2010,FURNISHED PHOTOCOPIES OF CHALLANS SHOWING PAYMENT OF RS. 11,13,008/-.AO WAS OF THE OPINION THAT THE ASSESSEE HAD DEFAULT IN MAKING PAYMENT OF SAT AS REQUIRED BY THE PROVISIONS OF SECTION 140A(1)OF THE ACT.HE I SSUED A FURTHER LETTER,DATED 4.02.2010,TO THE ASSESSEE ASKING HIM TO SHOW CAUSE AND EXPLAIN AS TO WHY PENALTY U/S. 221(1) R.W.S. 140A(3) OF THE ACT SHOULD NOT BE LEVIED FOR DEFAULT IN PAYMENT OF SAT. AS PER THE AO TILL 09.03.2010 ASSESSEE DID NOT FIL E ANY REPLY TO HIS SHOW CAUSE NOTICE.AO PASSED ORDER ON 09.03.2010 U/S. 221(1) R.W.S. 140A(3) OF THE ACT ON THE BASIS OF THE DETAILS AVAILABLE ON RECORD . HE HELD THAT ASSESSEE HAD TAXABLE INCOME AND WAS OBLIGED TO MAKE PAYMENT OF TAX IN FOUR INSTALLMENTS OF ADVANCE TAX FOR THE YEAR UNDER CONSIDERATION, THAT IT ABSTAINED FROM MAKING ANY PAYMENT OF ADVANC E TAX,THAT THE SAT LIABILITY WAS COMPUTED AT RS.10.7 LACS,THAT SAME WAS NOT PAID BEFORE FILING O F RETURN,THAT SAT WAS PAID ON 27.01.2010- ONLY AFTE R ISSUE OF LETTER DATED 20.01.2010,THAT IT WAS TO BE HELD AS ASSESSEE IN DEFAULT AS PER THE PROVISIONS OF SECTION 140A(3) OF THE ACT.HE LEVIED PENALTY OF RS. 1,07,019/- (10% OF THE SAT LIABILITY)U/S.221 OF THE ACT. 3. ASSESSEE PREFERRED AN APPEAL BEFORE THE FIRST APPEL LATE AUTHORITY(FAA).AFTER CONSIDERING THE ORDER PASSED BY THE AO AND THE SUBMISSIONS OF THE ASSESSE E,FAA HELD THAT THE ONLY REASON GIVEN BY THE ASSESSEE-COMPANY FOR NOT PAYING SAT WAS THAT THE ST AFF-MEMBERS OF THE ACCOUNT SECTION INADVERTENTLY DID NOT MAKE THE PAYMENT OF TAXES,THAT STAFF WAS OV ER BURDENED WITH THE WORK,THAT THE SUBMISSION OF THE ASSESSEE COULD NOT BE ACCEPTED AS GENUINE,THAT WHEN RETURN WAS FILED PAYMENT OF TAXES HAD TO BE CHECKED,THAT THE YEAR UNDER CONSIDERATION WAS NOT T HE FIRST YEAR OF THE ASSESSEE, THAT PAYMENT OF TAXE S WAS A REGULAR AND SYSTEMATIC ACTIVITY UNDERTAKEN BY THE ASSESSEE,THAT IT WAS HARD TO BELIEVE THAT THE MEMBERS OF ACCOUNT SECTION HAD COMMITTED THE MISTAK E OF NOT PAYING TAXES.FINALLY,HE HELD THAT ASSESSEE-COMPANY HAD NOT ADVANCED A GOOD AND SUFFIC IENT CAUSE FOR NOT PAYING SAT IN TIME FOR THE YEAR UNDER CONSIDERATION.ACCORDINGLY, HE CONFIRMED THE PENALTY LEVIED BY THE AO. 4. BEFORE US,AUTHORISED REPRESENTATIVE(AR) SUBMITTED T HAT ASSESSEE ALWAYS INTENDED TO PAY TAX IN TIME, THAT DUE TO AN OVER SITE OF MEMBERS OF THE STAFF OF SAT WOULD NOT BE PAID AT THE TIME OF FILING OF RET URN OF INCOME, THAT ONCE THE MISTAKE WAS BROUGHT TO NOT ICE OF THE ASSESSEE BY THE AO IT MADE A PAYMENT OF RS.11.13 LACS,SAID AMOUNT INCLUDED SAT OF RS.10.7 L ACS AND INTEREST OF RS. 42,816/- THAT THE ASSESSEE S ACCOUNT AND FINANCE SET OF WORK WAS QUITE SMALL, TH AT THERE WAS A GENUINE CAUSE FOR SELF-PAYMENT OF SAT THAT THE DEFAULT COMMITTED BY IT WAS TECHNICAL IN NATURE.HE RELIED UPON THE ORDER OF BAWA PAUL SINGH DELIVERED BY THE HONBLE HIGH COURT OF PUNJAB REPORTED IN 62ITR AT PAGE NO.147. DEPARTMENTAL REPRESENTATIVE (DR) SUPPORTED THE ORDER OF THE FAA. 5. WE HAVE HEARD AND PERUSED THE MATERIAL BEFORE US.BE FORE PROCEEDING FURTHER,WE WOULD LIKE TO CONSIDER THE HISTORY,BACKGROUND AND PRINCIPLES GOVE RNING THE PROVISIONS OF THE SECTION 140A OF THE ACT. SECTION 140A WAS INTRODUCED BY THE TAXATION LA WS (AMENDMENT)ACT,1970,WITH EFFECT FROM APRIL 1,1971 AND HAS BEEN AMENDED FRON TIME TO TIME.THE F IRST MAJOR AMENDMENT TO IT WAS BROUGHT BY THE TAXATION LAWS(AMENDMENT)ACT,1975,W.E.F.FROM APRIL 1 , 1976 AND IT WAS OPERATIVE TILL 31ST MARCH, 1989.AFTER THE AMENDMENT, THE ASSESSEE WAS REQUIRED TO PAY THE TAX DUE ON SELF-ASSESSMENT AND PRODUCE PROOF OF SUCH PAYMENT ALONG WITH HIS RETURN .IN THE EARLIER DAYS,THE ENTIRE TAX WAS PAYABLE,ONL Y AFTER THE ASSESSMENT WAS COMPLETED.AMENDMENT TO SEC TION, INTRODUCED IN 1988,PROVIDED FOR RECOVERY BY WAY OF PENALTY FROM AN ASSESSEE WHO FAILED TO P AY THE TAX OR ANY PART THEREOF IN ACCORDANCE WITH THE PROVISIONS OF SUB-SECTION (1).EXPLANATION INTRO DUCED BY THE AMENDMENT OF 1989 PROVIDED THAT WHERE THE AMOUNT PAID BY THE ASSESSEE UNDER THIS SU B-SECTION FELL SHORT OF THE AGGREGATE OF THE TAX AN D INTEREST AMOUNT SO PAID WOULD BE FIRST ADJUSTED TOW ARDS THE INTEREST PAYABLE AS AFORESAID AND THE 3 ITA NO.761/MUM/2012 DIAMONDSTAR EXPORTS LTD. BALANCE, IF ANY, WOULD BE ADJUSTED TOWARDS THE TAX PAYABLE.IT ALSO PROVIDED THAT ASSESSEE WOULD BE DEEMED TO BE AN ASSESSEE IN DEFAULT FOR TAX AS WELL AS INTEREST AMOUNT. ANOTHER AMENDMENT OF THE YEAR 1989 BROUGHT CONCEPT OF PAYMENT OF INTEREST U/S.234 A AND 234 B OF THE ACT.NEXT MAJOR CHANGE IN THE SECTION CAME IN THE YEAR 1999WHEN PROVISION OF THE SECTION 140A WERE MADE APPLICABLE TO SECTION 158BC.NOW THE PROVISIONS OF THE SECTION HAVE BEEN M ADE APPLICABLE TO THE ASSESSMENT TO BE MADE U/S.153A OF THE ACT ALSO. AMENDMENT OF 2013 TALK OF SUMS APPEARING UNDER FIVE HEADS THAT HAVE TO BE CONSIDERED FOR CALCULATING PAYABLE TAX AS PER THE PROVISIONS OF SECTION 140A OF THE ACT.SIMILARLY,FO R CALCULATING INTEREST U/S.234A OF THE ACT,SPECIAL PR OCEDURE HAS BEEN PRESCRIBED.EXPLNATION TO SECTION 3 DEFINES ASSESSED TAX.THOUGH MANY A AMENDMENTS HAVE BEEN MADE TO THE SECTION SINCE 1971,YET THE PENAL PROVISIONS HAVE REMAINED ALMOST SAME. 5.1. IT WILL BE USEFUL TO UNDERSTAND THE BASIC PRINCIPLE S OF SECTION 140A.AS PER THE PROVISIONS OF SECTION 139 OF THE ACT,EVERY PERSON WHOSE TOTAL INCOME,DURI NG THE PREVIOUS YEAR,EXCEEDS THE MAXIMUM AMOUNT NOT CHARGEABLE TO TAX IS SUPPOSED TO FURNISH A RETURN OF INCOME IN THE PRESCRIBED MANNER WITHIN THE PRESCRI -BED PERIOD. PROVISIONS OF THE ACT ALSO PROVIDE FOR PAYMENT OF ADVANCE TAX BY SCUH ASSESSEE.ADVANCE TAX IS PAYABLE IN INSTALMENTS.THE LIABILITY TO PAY ADVANCE TAX IS BASED UPON THE THEORYPAY AS YOU EARN. IT IS SAID THAT SECTION 14 0A IS ONE OF THE MODES/STAGES OF COLLECTION OF TAX DEVISED BY PARLIAMENT.THE PRINCIPLE BEHIND THE SAID SECTION IS THAT IF AT THE END OF THE YEAR THE ASSE SSEE IS LIABLE TO PAY ANY TAX ACCORDING TO HIS OWN ESTIM ATE OF HIS INCOME,HE SHOULD NORMALLY PAY ALMOST THE ENTIRE TAX IN THE SHAPE OF ADVANCE TAX.IN OTHER WOR DS IT IS REASONABLE TO PRESUME THAT EVERY PERSON EARNING TAXABLE INCOME KNOWS APPROXIMATELY THE TAX DUE FROM HIM AND IS EXPECTED TO AND HAS TO PAY THE SAME IN ACCORDANCE WITH LAW.SO,IT CAN SAFELY SA ID THAT THE PORTION OF INCOME,DUE TOWARDS INCOME- TAX,SHOULD NOT BE TREATED INCOMEBY A PRUDENT AND REASONABLE ASSESSEE,BECAUSE WHAT IS DUE TOWARDS TAX IS A DEBT DUE TO THE STATE.THE MERE FACT THAT I T IS NOT QUANTIFIED BY THE DEPARTMENT ON THAT DATE WOULD NOT MAKE IT ANYTHING LESS THE TAX DUE UNDER S ECTION 140A(1). 5.1.A. IF AN ASSESSEE REQUIRED TO PAY ADVANCE TAX,DOES NOT DO SO,HE IS TREATED TO BE AN ASSESSEE IN DEFAULT IN RESPECT OF SUCH INSTALMENT OR INSTALMENTS, AS TH E CASE MAY BE.AS A RESULT,PENALTY CAN BE LEVIED BY THE AO FOR SAID DEFAULT. 5.1.B. A DISCRETION IS CONFERRED UPON THE AO IN THE MATTER OF LEVYING THE PENALTY. IN A PROPER CASE, HE MAY DECLINE TO LEVY ANY PENALTY.THERE IS NOTHING IN THE PROVISIONS OF SECTION 140A THAT COMPEL THE AO TO LEVY SUCH A PENALTY IN EACH AND EVERY CASE AND/O R UP TO THE MAXIMUM LIMIT.IN OTHER WORDS FAILURE TO PAY THE TAX,AS PROVIDED IN SECTION 140A OF THE ACT, DOES NOT AUTOMATICALLY LEAD TO THE LEVY OF PENALTY UNDER SUB-SECTION(3).THE PROVISO TO SEC.140A(3)EXPR ESSLY PROVIDES FOR GIVING REASONABLE OPPORTUNITY TO THE ASSESSEE BEFORE LEVYING PENALTY.IN SHORT,THE POWER TO LEVY PENALTY U/S.140A(3) OF THE ACT IS NO T ABSOLUTE BUT DISCRETIONARY. 5.1.C. EVEN IF THERE IS A DEFAULT,AO IS BOUND TO CONSIDER THE CIRCUMSTANCES OF THE CASE AND GIVE HIS REASONS AS TO WHY THE PENALTY SHOULD BE IMPOSED AS PER THE PROVISIONS OF SECTION 140A(3). 5.1.D. THE QUESTION WHETHER THE FACTS OF A GIVEN CASE WILL CONSTITUTE GOOD AND SUFFICIENT REASON FOR NOT IMPOSING A PENALTY IS A QUESTION OF FACT. 5.1.E. FINANCIAL CRISIS CAN BE ONE OF THE SUFFICIENT AND G OOD REASON FOR NOT LEVYING PENALTY.BUT,THE CLOSING CASH BALANCE CANNOT PROVIDE A BASIS FOR ASC ERTAINING THE ACTUAL FINANCIAL CONDITION OF THE ASSESSEE. 5.2. UNDISPUTED FACTS OF THE CASE ARE THAT THE ASSESSEE HAD NOT PAID DUE TAXES BEFORE FILING OF RETRUN,THAT IT WAS NOT THE FIRST YEAR OF COMMENCEMENT OF BUSINE SS,THAT ASSESSEE PAID TAXES AFTER IT RECEIVED A LET TER FROM THE AO.PROVISIONS OF SEC.140A(3)R.W.S.221(1)OF THE ACT ARE VERY CLEAR.SECTION140A(3) STIPULATES THAT IF ANY ASSESSEE FAILS TO PAY THE WHOLE OR ANY PART OF SUCH TAX /INTEREST/BOTH IN ACCORDANCE WITH THE 4 ITA NO.761/MUM/2012 DIAMONDSTAR EXPORTS LTD. PROVISIONS OF SUB-SECTION (1),HE SHALL, BE DEEMED T O BE AN ASSESSEE IN DEFAULT IN RESPECT OF THE TAX O R INTEREST OR BOTH REMAINING UNPAID, AND ALL THE PROV ISIONS OF THIS ACT SHALL APPLY ACCORDINGLY. SECTION 221(1)COMES IN TO PLAY ONCE IT IS FOUND THAT DEFAUL T HAS BEEN COMMITTED BY ANY ASSESSEE IN PAYMENT OF TAX.EXPLANATION TO THE SECTION 221(1)PROVIDES THAT AN ASSESSEE SHALL NOT CEASE TO BE LIABLE TO ANY PENALTY UNDER THIS SUB-SECTION MERELY BY REASON OF THE FACT THAT BEFORE THE LEVY OF SUCH PENALTY HE HA S PAID THE TAX.IN OUR OPINION,EXPLANATION HAS MADE IT CLEAR THAT MERE PAYMENT OF TAXES WILL NOT EXONERAT E THE ASSESSEE AND HE CANNOT CLAIM IMMUNITY FROM THE PENAL PROVISIONS AS ENVISAGED IN THE SECTION.AS PER THE PROVISIONS OF THE SECTION PENALTY IS NOT TO BE LEVIED IF ASSESSEE PROVES,TO THE SATISFACTION O F THE AO,THAT THE DEFAULT WAS FOR GOOD AND SUFFICIENT REA SONS.SECOND CONDITION FOR LEVYING PENALTY IS THAT BEFORE LEVYING ANY SUCH PENALTY THE ASSESSEE HAS TO BE GIVEN A REASONABLE OPPORTUNITY OF BEING HEARD.AS FAR AS FIRST CONDITION IS CONCERNED,ONUS I S ON THE ASSESSEE TO PROVE THE EXISTENCE OF GOOD AN D SUFFICIENT REASON,WHEREAS AO HAS TO ESTABLISH THAT HE AFFORDED A REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE.IN THE CASE UNDER CONSIDERATION IT IS FOUND THAT THE AO HAD LEVIED THE PENALTY AFTER ISSU ING SHOW CAUSE NOTICE TO THE ASSESSEE.THUS,AS FAR AS AO IS CONCERNED,HE HAS FOLLOWED THE MANDATE OF THE ACT.WE ARE OF THE OPINION THAT SAME CANNOT BE HELD IN THE CASE OF THE ASSESSEE.ASSESSEE DID NOT FILE A NY REPLY BEFORE THE AO AND BEFORE THE FAA IT SUBMITTED THAT BECAUSE OF THE MISTAKE COMMITTED BY THE MEMBERS OF THE STAFF TAX COULD NOT BE IN TIME.FAA H AS CLEARLY HELD THAT BEFORE HIM THE ASSESSEE DID NO T FURNISH ANY GOOD OR SUFFICIENT REASON.WORDS GOOD A ND SUFFICIENT REASON HAVE NOT BEEN DEFINED IN THE ACT.BUT,COURTS ARE OF THE VIEW THAT BEYOND CONTROL OF THE ASSESSEE CAN BE TERMED SUFFICIENT CAUSE.WE FIND THAT THE ASSESSEE HAD NOT SHOWN ANY CAUSE AS W HY IT COULD NOT PAY TAXES IN TIME.ASSESSEE IS A CORPORATE ENTITY PAYING TAX OF LACS OF RUPEES EVERY YEAR.IT IS NOT FUNCTIONING FROM A REMOTE VILLAGE.I T IS NOT THE CASE THAT ASSESSEE WAS FACING FINANCIAL CRU NCH AND BECAUSE OF THAT IT COULD NOT PAY TAXES IN T IME. AS DISCUSSED EARLIER,PAUCITY OF FUNDS OR FINANCIAL PROBLEMS HAVE BEEN CONSIDERED SUFFICIENT CAUSE FOR NOT MAKING PAYMENT OF TAXES BY THE COURTS.IN THE MA TTERS OF INDO AMERICAN ELECTRICALS LTD.(155ITR 63)SREEDHARAN AND COMPANY LTD.(195 ITR 807) AND RAMACHANDRA PESTICIDES(285ITR45) HONBLE HIGH COURTS OF CALCUTTA,KERALA AND KARNATAKA HAVE H ELD THAT SIPHONING OFF OF FUNDS OR POOR RECOVERIES FROM CONSUMERS OR SHORTAGE OF FUND DUE TO NATURAL C ALAMITIES CAN BE CONSIDERED THE REASONABLE CAUSE FOR NOT PAYING ADVANCE TAX.BUT,SUCH EXTRA ORDINARY SITUATION WERE NOT PRESENT IN THE CASE UNDER CONSID E -RATION.ASSESSEE CANNOT CLAIM IGNORANCE OF ITS DUTY OF PAYING TAXES IN STIPULATED TIME-FRAME.FOR LAST SO MANY YEAR INCOME-TAX DEPARTMENT LAUNCHES AUDIO VISU AL CAMPAIGN TO REMIND THE ASSESSEES ABOUT THE DUE DATES OF TAX-PAYMENT.THE FACT THAT THE ASSESSEE IS MAINTAINING A SEPARATE SECTION TO DEAL WITH ACCOUNTS,INCLUDING TAXATION MATTERS,PROVE THAT IT I S AWARE OF THE DUTIES REGARDING TAX PAYMENT.BESIDES , ASSESSEE IS ALSO ASSISTED BY QUALIFIED PROFESSIONAL S WHO HAVE REPRESENTED IT BEFORE THE DEPARTMENTAL AUTHORITIES.WE ARE OF THE OPINION THAT PENALTY IMPO SED/CONFIRMED BY THE AO/FAA IS IN THE NATURE OF ADDITIONAL TAX FOR SECURING COMPLIANCE WITH THE PRO VISIONS OF THE ACT.PENAL PROVISIONS FOR NON-PAYMENT OF TAXES HAVE BEEN INCORPORATED IN THE ACT,AS STATE D EARLIER,SO THAT THE TAX IS PAID,BY THE ASSESSEES, WITHIN THE TIME ALLOWED U/S.140A(1) OF THE ACT.WE A RE AWARE THAT INCOME OF AN ASSESSEE BELONGS TO HIM,BUT HIS RIGHT IS SUBJECT TO PAYMENT OF DUES TO THE SOVEREIGN I.E.TAXES.STATE HAS ALL THE RIGHTS T O RECOVER TAXES AND A MAKE REASONABLE PROVISION TO SE CURE PAYMENT OF TAX ON DUE DATE.IN OUR OPINION THAT THE ASSESSEE HAD NOT OFFERED ANY GOOD AND SUFFICIEN T REASON FOR NOT PAYING TAXES ON DUE DATES,SO FAA WAS JUSTIFIED IN REJECTING APPEAL FILED BY IT.WE AR E OF THE OPINION THAT PAYMENT OF TAX,ALONG WITH INTEREST,AFTER DUE DATES CANNOT BE CONSIDERED A SUF FICIENT CAUSE FOR ADHERING TO THE PROVISIONS OF SEC TION 140A OF THE ACT.WE FIND THAT THE FACTS OF THE CASE RELIED UPON BY THE ASSESSEE IS NOT RELEVANT FOR DECIDING THE ISSUE BEFORE US.THEREFORE,UPHOLDING TH E ORDER OF THE FAA,WE DECIDE EFFECTIVE GROUND OF APPEAL AGAINST THE ASSESSEE-COMPANY. AS A RESULT, APPEAL FILED BY THE ASSESSEE STANDS DISMISSED. 1 2 $1, 3 4 $!5 + !, 67. 5 ITA NO.761/MUM/2012 DIAMONDSTAR EXPORTS LTD. ORDER PRONOUNCED IN THE OP EN COURT ON 4 TH OCTOBER,2013. '0 + -.% ' 8 9: 5 9: 5 9: 5 9: 5 4 , ,, , 2013 . + /. SD/- SD/- ( . .. . . .. . , ,, , / I.P.BANSAL ) ( !'# !'# !'# !'# / RAJENDRA) / JUDICIAL MEMBER ' ' ' ' /ACCOUNTANT MEMBER / MUMBAI, ;$ /DATE: 04.10 .2013 SK '0 '0 '0 '0 + ++ + (,< (,< (,< (,< ='<%, ='<%, ='<%, ='<%, / COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE / &' 2. RESPONDENT / ()&' 3. THE CONCERNED CIT(A)/ > ? , 4. THE CONCERNED CIT / > ? 5. DR D BENCH, ITAT, MUMBAI / <@/ (,$ . , . . . 6. GUARD FILE/ / A )<, (, //TRUE COPY// '0$ / BY ORDER, B / 6 ! DY./ASST. REGISTRAR , /ITAT, MUMBAI