ZEENAT P SANGHAVI, MUMBAI V. DCIT CEN CIR 38, MUMBAI

ITA 8692/MUM/2011

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 9282 (ITAT-MUMBAI)
• Duration Of Justice: 11 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-12-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2005-2006
• Appeal Filed On: 23-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SASHI TULSIAN
• Keywords: Gift; Reasonable cause
• Section: 27

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH G , MUMBAI BEFORE SHRI RAJENDRA SINGH, ACCOUNTANT MEMBER AND SHRI VIVEK VARMA, JUDICIAL MEMBER ITA NO. 8692/MUM/2011 ASSESSMENT YEAR : 2005-06 SMT. ZEENAT P. SANGHVI 2203, WINDSOR TOWER SHASTRI NAGAR, ANDHERI (W) MUMBAI-400 053. PAN NO.AVMPS 7416 M VS. DY. COMMISSIONER OF INCOME TAX CENTRAL CIRCLE-38 MUMBAI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SASHI TULSIAN RESPONDENT BY : SHRI MOHIT JAIN DATE OF HEARING : 12.12.2012 DATE OF PRONOUNCEMENT : 12.12.2012 O R D E R PER RAJENDRA SINGH, AM: THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 4.10.2011 OF CIT(A) FOR THE ASSESSMENT YEAR 2005-06. T HE ONLY DISPUTE RAISED IN THIS APPEAL IS REGARDING LEVY OF PEN ALTY UNDER SECTION 271(1)(B) OF THE INCOME TAX ACT, 1961 (THE ACT) FOR NO N COMPLIANCE OF STATUTORY NOTICE. 2. THE FACTS IN BRIEF ARE THAT THE AO DURING THE ASSESSM ENT PROCEEDINGS ASKED THE ASSESSEE TO PRODUCE CERTAIN DETAILS AN D ITA NO. 8692/M/11 A.Y. 05-06 2 EVIDENCE ON 20.10.2009, BUT THERE WAS NO COMPLIANCE. T HE AO, THEREFORE, VIDE LETTER DATED 22.10.2009 ASKED THE ASSE SSEE AS TO WHY PENALTY UNDER SECTION 271(1)(B) SHOULD NOT BE INITIATE D TO WHICH THERE WAS NO RESPONSE. THE AO THEREAFTER VIDE LETTER DATED 4 .11.2009 ASKED THE ASSESSEE TO EXPLAIN AS TO WHY PENALTY UNDER SECTION 27 1(1)(B) SHOULD NOT BE LEVIED. TO THIS LETTER ALSO THERE WAS NO RESPONSE AND THE AO, THEREFORE, LEVIED PENALTY OF RS.10,000/-. THE ASSE SSEE DISPUTED THE LEVY OF PENALTY AND SUBMITTED BEFORE CIT(A) THAT ASSESSEE HAD ULTIMATELY COMPLIED WITH THE NOTICES BY FILING VARIOU S DETAILS AND THEREAFTER NORMAL ASSESSMENT WAS MADE. THERE WAS ALSO NO N ON- COMPLIANCE AFTER ASSESSMENT WAS FRAMED. THERE WAS, THUS, NO DELIBERATE NON-COMPLIANCE. CIT(A) HOWEVER DID NOT ACCEP T THE CONTENTIONS RAISED AND HELD THAT THE ASSESSEE HAD COMMITTED DEFAULT FOR WHICH NO REASONABLE CAUSE HAD BEEN GIVEN. HE, THEREF ORE, CONFIRMED THE PENALTY, AGGRIEVED BY WHICH THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 3. BEFORE US, THE LD. AR SUBMITTED THAT THE ASSESSEE COULD NOT APPEAR ON 20.10.2009, AND THE AO HAD WRITTEN FURTHE R LETTER DATED 22.10.2009 FOR IMMEDIATE COMPLIANCE AS MENTIONED IN TH E ASSESSMENT ORDER FOLLOWED BY ANOTHER LETTER DATED 4.11.2009 RE ITERATING THE REQUIREMENTS FOR PROVING THE GIFT AND CREDITWORTHINESS. THE ASSESSEE HAD COMPLIED TO THIS LETTER AND ULTIMATELY ASSESSMENT WAS MADE UNDER ITA NO. 8692/M/11 A.Y. 05-06 3 SECTION 143(3). IT WAS THUS CLEAR THAT THERE WAS NO DELIB ERATE NON- COMPLIANCE ON PART OF THE ASSESSEE. THE LD. AR ALSO POINTE D OUT THAT SIMILAR PENALTY HAD BEEN LEVIED IN CASE OF THE ASSESSEE FO R THE ASSESSMENT YEARS 2002-03 TO 2004-05, 2006-07 AND 2008-09 AND ALL THESE PENALTIES WERE DELETED BY THE TRIBUNAL IN THE O RDER DATED 9.5.2012 IN ITA NO.8656 TO 8658/M/11 AND IN ITA NO. 8660 TO 8661/M/11. IT WAS, THEREFORE, URGED THAT PENALTY LE VIED FOR THIS YEAR SHOULD ALSO BE DELETED. THE LD. DR PLACED RELIANCE ON T HE ORDERS OF AUTHORITIES BELOW. 4. WE HAVE PERUSED THE RECORDS AND CONSIDERED THE MATTER CAREFULLY. THE DISPUTE IS REGARDING LEVY OF PENALTY UNDER SECTION 271(1)(B) FOR NON-COMPLIANCE OF STATUTORY NOTICE ON 20. 10.2009. A PERUSAL OF THE ASSESSMENT ORDER SHOWS THAT AFTER THE SAID NON- COMPLIANCE, THE AO VIDE LETTER DATED 22.10.2009 HAD R EQUESTED THE ASSESSEE FOR IMMEDIATE COMPLIANCE FOLLOWED BY FURTHER LET TER DATED 4.11.2009 TO WHICH THE ASSESSEE DID COMPLY WITH DETAILS V IDE LETTER DATED 30.11.2009. THUS, ONCE THE AO HAD HIMSELF ALLOWE D FURTHER TIME AS IS CLEAR FROM THE ASSESSMENT ORDER AND THE ASSESSEE ULTIMAT ELY COMPLIED WITH, IT CAN NOT BE CONSIDERED AS A DELIBERATE NON-COMPLIANCE BY THE ASSESSEE. WE ALSO FIND THAT SIMILAR PENALTY HAD B EEN LEVIED BY AO FOR SAME DEFAULT ON 20.10.2009 IN OTHER ASSESSMENT YE ARS WHICH HAS BEEN DELETED BY THE TRIBUNAL IN THE ORDER DATED 9.5.2012. THE ITA NO. 8692/M/11 A.Y. 05-06 4 TRIBUNAL PLACED RELIANCE ON THE JUDGMENT OF HONBLE SU PREME COURT IN THE CASE OF HINDUSTAN STEEL LTD. VS. STATE OF ORISSA (83 ITR 26) IN WHICH IT HAS BEEN HELD THAT PENALTY WHICH IS THE RESULT OF QUASI CRIMINAL PROCEEDING WILL NOT ORDINARILY BE IMPOSED UNLESS THE PA RTY OBLIGED EITHER ACTED DELIBERATELY IN DEFIANCE OF LAW OR WAS GU ILTY OF CONDUCT CONTUMACIOUS OR DISHONEST, OR ACTED IN CONSCIOUS DISREGARD O F ITS OBLIGATION. THE TRIBUNAL NOTED THAT THERE WAS NO DEL IBERATE DEFIANCE OF LAW ON THE PART OF THE ASSESSEE. IN THIS CASE, THE TRIBUN AL ACCORDINGLY DELETED THE PENALTY. FACTS IN THE PRESENT CASE ARE IDEN TICAL AS PENALTY HAS BEEN LEVIED IN AN IDENTICAL MANNER FOR THE SAME DE FAULT ON 20.10.2009. THEREFORE, RESPECTFULLY FOLLOWING THE DECI SION OF THE TRIBUNAL IN ASSESSEES OWN CASE IN ITS ORDER DATED 9.5.201 2 IN ITA NOS.8656 TO 8658/M/11 AND IN ITA NOS.8660 TO 8661/M/1 1, WE SET ASIDE THE ORDER OF THE CIT(A) AND DELETE THE PENALTY . 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 12.12.2012. SD/- SD/- ( VIVEK VARMA ) JUDICIAL MEMBER (RAJENDRA SINGH) ACCOUNTANT MEMBER MUMBAI, DATED: 12.12.2012. JV. ITA NO. 8692/M/11 A.Y. 05-06 5 COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR BENCH TRUE COPY BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.