Sh. Balbir Singh Chadha, Chandigarh V. ITO, W-4(4), Chandigarh

ITA 84/CHANDI/2019

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 8944 (ITAT-CHANDIGARH)
• Duration Of Justice: 7 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 14-08-2019
• Assessment Year: 2010-2011
• Appeal Filed On: 29-01-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S K BHASIN
• Keywords: Reasonable cause
• Section: 148

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH A , CHANDIGARH , ! '# $ % & '# , BEFORE: SHRI SANJAY GARG, JUDICIAL MEMBER AND SMT.ANNAPURNA GUPTA, ACCOUNTANT MEMBER ./ ITA NOS.84 & 85/CHD/2019 / ASSESSMENT YEAR : 2010-11 SH.BALBIR SINGH CHADHA, HOUSE NO.2115, SECTOR-35C, CHANDIGARH. THE CIT(APPEALS)-2, CHANDIGARH. ./PAN NO: AAGPC7960D /APPELLANT /RESPONDENT /ASSESSEE BY : SHRI S.K.BHASIN, CA. ! / REVENUE BY : SMT.CHANDERKANTA, SR. DR ' # $ /DATE OF HEARING : 14.08.2019 %&'( $ /DATE OF PRONOUNCEMENT: 26.09.2019 /ORDER PER ANNAPURNA GUPTA, ACCOUNTANT MEMBER : BOTH THE ABOVE APPEALS HAVE BEEN PREFERRED BY THE SAME ASSESSEE AGAINST THE SEPARATE ORDERS OF THE COMMISSIONER OF INCOME TAX (APPEALS)-2, CHANDIGARH [(IN SHORT REFERRED TO AS CIT(A)] BOTH DATED 28.12.201 8, PASSED U/S 250(6) OF THE INCOME TAX ACT,1961, (HEREINAFTER REFERRED TO AS ACT), RELATING TO ASSESSMENT YEAR 2010-11, CONFIRMING THE LEVY OF PENALTY. ITA NOS.84 & 85/CHD/2019 A.Y. 2010- 11 2 2. AT THE OUTSET, IT WAS POINTED OUT THAT WHILE TH E APPEAL IN ITA NO.84/CHD/2019 CHALLENGES THE LEVY OF PENALT Y U/S 271B OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT ) ON ACCOUNT OF FAILURE OF THE ASSESSEE TO GET ITS ACCOU NTS AUDITED BEFORE THE SPECIFIED DATE, AS PER THE PROVISIONS OF SECTION 44AB OF THE ACT, THE APPEAL IN ITA NO.85/CHD/2019 CHALLENGES THE LEVY OF PENALTY U/S 271F OF THE ACT ON ACCOUNT OF DELAY IN FILING OF INCOME TAX RETURN ,I .E FILING BEYOND THE SPECIFIED DATE, FOR THE IMPUGNED YEAR I. E. ASSESSMENT YEAR 2010-11. 3. THE LD.COUNSEL FOR THE ASSESSEE CONTENDED THAT HIS ARGUMENTS AGAINST THE LEVY OF BOTH THE PENALTIES WA S COMMON. THEREFORE BOTH THE APPEALS WERE HEARD TOGET HER AND ARE BEING DISPOSED OFF BY THIS COMMON CONSOLIDA TED ORDER 4. LD.COUNSEL FOR THE ASSESSEE POINTED OUT THAT BOT H THE DEFAULTS WERE INADVERTENT AND BEYOND THE CONTROL O F THE ASSESSEE SINCE THE TAXATION MATTERS OF THE ASSESSEE WERE BEING LOOKED AFTER BY TAX CONSULTANTS AND TAX AUDIT ORS, WHO DUE TO HEAVY RUSH OF RETURN HAD FAILED TO FILE ITR BY THE DUE DATE ALONGWITH TAX AUDIT REPORT U/S 44AB OF THE ACT AND SINCE THE ASSESSEE WAS AWAY TO NEW ZEALAND FROM 6.9 .2010 TO 16.3.2011, HE COULD NOT FOLLOW UP THE SAME WITH HIS ITA NOS.84 & 85/CHD/2019 A.Y. 2010- 11 3 CONSULTANTS AND IT WAS ONLY THEREAFTER WHEN THE NOT ICE U/S 148 OF THE ACT WAS RECEIVED BY HIM ON 5.11.2017 THA T THE SAID DEFAULTS WERE ACTED UPON AND RECTIFIED. THE LD .COUNSEL FOR THE ASSESSEE ALSO POINTED OUT THAT HIS RETURN F OR THE IMPUGNED YEAR HAD BEEN SUBJECTED TO SCRUTINY AND TH E RETURNED INCOME HAD BEEN ACCEPTED AS SUCH WITHOUT M AKING ANY ADDITION. COPY OF THE ASSESSMENT ORDER PASSED F OR THE IMPUGNED YEAR WAS FILED BEFORE US. IT WAS, THEREFOR E, STATED THAT EVEN OTHERWISE NO PREJUDICE WAS CAUSED TO THE REVENUE ON ACCOUNT OF THIS DEFAULT OF THE ASSESSEE. 5. LD.DR ON THE OTHER HAND RELIED ON THE ORDER OF T HE CIT(A) POINTING OUT THAT THE BUSYNESS OF THE TAX CO NSULTANT AND THE ABSENCE OF THE ASSESSEE FROM THE COUNTRY AT THAT POINT OF TIME DOES NOT CONSTITUTE REASONABLE CAUSE FOR THE LAPSE/DEFAULT, WHEN THE ASSESSEE COULD VERY WELL HA VE FOLLOWED UP WITH HIS CONSULTANT FOR COMPLYING WITH THE STATUTORY DEADLINES. 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND DO NOT F IND IT A FIT CASE FOR LEVY OF PENALTY FOR DELAYED FILING O F TAX AUDIT REPORT AND INCOME TAX RETURN. UNDOUBTEDLY THE REVEN UE COULD NOT FIND ANY FAULT IN THE INCOME RETURNED BY THE ASSESSEE FOR THE IMPUGNED YEAR, DESPITE SUBJECTING IT TO SCRUTINY ASSESSMENT. WHAT EMERGES FROM THE SAME IS THAT ITA NOS.84 & 85/CHD/2019 A.Y. 2010- 11 4 THE NON FILING OF TAX AUDIT REPORT AND OF THE RETUR N OF INCOME BY THE SPECIFIED DUE DATE WAS DEFINITELY NOT INTENT IONAL WITH THE PURPOSE OF NOT DISCLOSING ANY INCOME FOR TAXATI ON. THE PLEA OF THE ASSESSEE THEREFORE THAT IT WAS AN INADV ERTENT DEFAULT, ON ACCOUNT OF THE TAX CONSULTANT BEING BUS Y WITH GST RETURNS AND THE ASSESSEE NOT BEING ABLE TO ADEQ UATELY FOLLOW UP WITH HIM SINCE HE WAS AWAY IN NEW ZEALAND , APPEARS TO BE A REASONABLE CAUSE. IN VIEW OF THE SAME WE HOLD THAT NO PENALTY U/S 271 B AND 271F WAS LEVIABLE IN THE PRESENT CASE AND DIREC T DELETION OF BOTH. 7. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- $ % & '# (SANJAY GARG) (ANNAPURNA GUPTA) /JUDICIAL MEMBER () /ACCOUNTANT MEMBER +$ /DATED: 26 TH SEPTEMBER, 2019 * # * &) *+,+ / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ' - / CIT 4. ' - ( )/ THE CIT(A) 5. +./ 0 , $0 , 123/4 / DR, ITAT, CHANDIGARH 6. /35# / GUARD FILE &) ' / BY ORDER, / ASSISTANT REGISTRAR