M/s. JCL Infra Ltd., Uttar Pradesh V. Addl. CIT (TDS), Ghaziabad

ITA 785/DEL/2015

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 5789 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 4 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-06-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2009-2010
• Appeal Filed On: 09-02-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Reasonable cause
• Section: 273B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D, NEW DELHI BEFORE SH. G.D. AGRAWAL, PRESIDENT AND SH. SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA NO.784-85/DEL/2015 (A.Y. : 2008-09) (A. Y. : 2009-10) JCL INFRA LTD. C/O. M/S. DEEPAK JAIN & CO., 201, POLICE STREET, MEERUT CANTT UTTAR PRADESH VS. ADDL. CIT (TDS) CGO COMPLEX-I, HAPUR ROAD GHAZIABAD PAN : AAACJ8106D (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : SH. AMIT JAIN, SR. DR DATE OF HEARING : 24.04.2018 DATE OF PRONOUNCEMENT : 28.06.2018 O R D E R PER BENCH : BOTH THESE APPEALS HAVE BEEN FILED BY THE ASSESSEE. ITA NO. 784/DEL/2015 IS AGAINST ORDER DATED 10.12.2014 PASS ED BY THE LD. CIT(A)-MEERUT FOR ASSESSMENT YEAR 2008-09 WHEREIN, VIDE THE IMPUGNED ORDER, THE LD. CIT(A) HAS CONFIRMED IMPOSI TION OF PENALTY OF RS. 32,900/- IMPOSED U/S 272A(2)(K) OF THE INCOM E TAX ACT, 1961 2 ITA NO.784-85/DEL/2014 (JCL INFRA LTD.) (HEREINAFTER CALLED TO ACT). SIMILARLY, ITA NO. 7 85/DEL/2015 IS CHALLENGING THE CONFIRMATION OF PENALTY OF RS. 27,4 00/- IMPOSED U/S 272A(2)(K) OF THE ACT VIDE ORDER DATED 10.12.20 14 PASSED BY THE LD. CIT(A)-MEERUT FOR ASSESSMENT YEAR 2009-10. 2. NONE WAS PRESENT ON BEHALF OF THE ASSESSEE WHEN TH E APPEALS WERE CALLED OUT FOR HEARING NOR WAS ANY APPLICATION F OR ADJOURNMENT RECEIVED ON BEHALF OF THE ASSESSEE/APPELLANT. HOWEV ER, LOOKING INTO THE FACTS OF THE CASE, WE ARE PROCEEDING TO DECIDE T HE CASE EX PARTE QUA THE ASSESSEE/ APPELLANT. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS A COMPANY AND THE TAX DEDUCTED AT SOURCE BY THE ASSESSEE WAS NOT PAID TO THE CREDIT OF THE CENTRAL GOVERNMENT WITHIN THE PRESCRIB ED PERIOD. FURTHER, THE ASSESSEE DID NOT FILE THE QUARTERLY ST ATEMENTS IN FORM 26Q WITHIN THE PRESCRIBED TIME. THE AO (TDS) NOTED T HAT THE QUARTERLY STATEMENTS IN ASSESSMENT YEAR 2008-09 WER E FILED LATE BY 228 DAYS FOR THE FIRST QUARTER, 165 DAYS FOR THE SE COND QUARTER AND 150 DAYS FOR THE THIRD QUARTER. THUS, THE TOTAL NUM BER OF DAYS FOR LATE FILING WAS COUNTED TO BE 543 DAYS. THE AO FURTH ER NOTED THAT THE QUARTERLY STATEMENTS IN FORM 24Q WERE ALSO DELA YED BY 543 3 ITA NO.784-85/DEL/2014 (JCL INFRA LTD.) DAYS. HE, ACCORDINGLY, IMPOSED A PENALTY OF RS. 1,0 8,600/- FOR BOTH THE DEFAULTS. 3.1 SIMILARLY, IN ASSESSMENT YEAR 2009-10, THE QUAR TERLY STATEMENTS WERE FILED BELATEDLY. THERE WAS A DELAY OF 376 DAYS FOR THE FIRST QUARTER, 251 DAYS FOR THE SECOND QUARTER AND 161 DAYS FOR THE THIRD QUARTER. THUS, THE TOTAL DELAY IN FILING WAS COUNTED AT 788 DAYS AND, ACCORDINGLY, A PENALTY OF RS. 78,800/- WAS IMPOSED. 3.2 THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT (A) AND SUBMITTED THAT THE PERIOD OF DEFAULT SHOULD BE CALC ULATED IN RESPECT OF PERIOD OF DELAY AFTER THE PAYMENT OF TDS TO THE CENTRAL GOVERNMENT. THE ASSESSEE ALSO SUBMITTED BEFORE THE LD. CIT (A) THAT THE ASSESSEE WAS IN SEVERE FINANCIAL CRISIS AND , THEREFORE, THE TDS COULD NOT BE DEPOSITED IN TIME. THE LD. CIT (A) NOTED THAT THE ASSESSEE HAD NOT ONLY DELAYED THE FILING OF THE QUA RTERLY RETURNS BUT ALSO DID NOT DEPOSIT THE TAX DEDUCTED BY IT. THE LD . CIT (A) NOTED THAT HAD THE ASSESSEE COMMITTED THE DEFAULT OF ONLY LATE FILING, IT COULD HAVE BEEN HELD TO BE A MERE TECHNICAL BREACH BUT SINCE THE TAX WAS NOT ALSO DEPOSITED WITHIN THE PRESCRIBED PERI OD, PENALTY WAS IMPOSABLE. THE LD. CIT (A), HOWEVER, HELD THAT A S THERE WERE MISTAKES IN COUNTING THE NUMBER OF DAYS OF DEFAULT AND FURTHER THAT 4 ITA NO.784-85/DEL/2014 (JCL INFRA LTD.) IN ASSESSMENT YEAR 2008-09 THE DELAY IN FILING OF F ORM 26Q WAS OF ONLY OF 313 DAYS WHILE THE DELAY IN FILING FORM 24Q WAS OF 16 DAYS ONLY, THE QUANTUM OF PENALTY WAS TO BE FIXED AT RS. 32,900/-. SIMILARLY, IN ASSESSMENT YEAR 2009-10, THE LD. CIT (A) NOTED THAT THE DELAY IN FILING OF FORM 26Q WAS ONLY 274 DAYS AN D, THEREFORE, THE QUANTUM OF PENALTY WAS FIXED AT RS. 27,400/-. 3.3 THE ASSESSEE IS IN APPEAL BEFORE US AGAINST THE PENALTIES, AS SUSTAINED BY THE LD. CIT (A). 4. THE LD. SR. DEPARTMENTAL REPRESENTATIVE PLACED R ELIANCE ON THE FINDINGS OF THE LD. CIT (A) AND ARGUED THAT THE PENALTIES HAD BEEN RIGHTLY SUSTAINED. 5. WE HAVE HEARD THE LD. SR. DEPARTMENTAL REPRESENT ATIVE AND HAVE ALSO PERUSED THE IMPUGNED ORDERS. THE ASSESSEE HAS PLEADED BEFORE THE LD. CIT (A) THAT THE DELAY WAS DUE TO SEV ERE FINANCIAL CRISIS WHICH THE ASSESSEE WAS FACING. HOWEVER, IT IS SEEN THAT THE LD. CIT (A) HAS NOT CONSIDERED THIS SUBMISSION OF T HE ASSESSEE NAD HAS UPHELD THE PENALTY ON THE GROUND THAT EVEN THE TAX DEDUCTED AT SOURCE WAS NOT DEPOSITED IN TIME. HOWEVER, IT IS OUR CONSIDERED OPINION SEVERE FINANCIAL CRISIS IS A REASONABLE CAU SE WHICH WOULD HAVE PREVENTED THE ASSSESSEE FROM DEPOSITING THE TD S WITHIN THE 5 ITA NO.784-85/DEL/2014 (JCL INFRA LTD.) PRESCRIBED TIME PERIOD. IN SUCH A CIRCUMSTANCE, WE HOLD THAT THE EXPLANATION OFFERED BY THE ASSESSEE WOULD CONSTITUTE REASONABLE CAUSE WITHIN THE MEANING OF SECTION 273B OF THE ACT AND HENCE THE ASSESSEE WOULD BE ENTITLED TO IMMUNITY FROM THE LEV Y OF PENALTY U/S 272A(2)(K). ACCORDINGLY, IN VIEW OF THE FACTS, WE SET ASIDE THE IMPUGNED ORDERS AND DIRECT THE AO TO DELETE THE PEN ALTY. 6. IN THE FINAL RESULT, BOTH THE APPEALS OF THE ASS ESSEE STAND ALLOWED. (ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH JUNE, 2018). SD/- SD/- (G.D.AGARWAL) (SUDHANSHU SRIVASTAVA ) PRESIDENT J UDICIAL MEMBER DATE: 28.06.2018 BINITA COPY OF ORDER TO: - 1) THE APPELLANT; 2) THE RESPONDENT; 3) THE CIT; 4) THE CIT(A)-, NEW DELHI; 5) THE DR, I.T.A.T., NEW DELHI; TRUE COPY BY ORDER ITAT, NEW DELHI 6 ITA NO.784-85/DEL/2014 (JCL INFRA LTD.)