Chintamani Cateres, Pune V. Assistant Commissioner of Income tax, Pune

ITA 886/PUN/2017

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 2333 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 2 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-06-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 11-04-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHRI
• Keywords: Revised return; Set aside
• Section: 271(1)(c); 133A; 131; 27

Judgement Text

] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B , PUNE BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO.886/PUN/2017 / ASSESSMENT YEAR : 2012-13 CHINTAMANI CATERE R S, SURVEY NO.34, PARMAR COMPLEX, PUNE MUMBAI ROAD, NIGADI, PUNE 411044. PAN : AACFC5978K. . / APPELLANT V/S THE ASST. COMMISSIONER OF INCOME - TAX, CIRCLE 9, PUNE. . / RESPONDENT ASSESSEE BY : NONE REVENUE BY : SHRI PANKAJ GARG. / ORDER PER ANIL CHATURVEDI, AM : 1. THIS APPEAL FILED BY THE ASSESSEE IS EMANATING OUT OF THE O RDER OF COMMISSIONER OF INCOME TAX (A) 13, PUNE DT.27.01.2017 FO R THE ASSESSMENT YEAR 2012-13. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON R ECORD ARE AS UNDER :- ASSESSEE IS A PARTNERSHIP FIRM STATED TO BE ENGAGED IN THE BUSINESS OF RESTAURANT AND CATERING. ASSESSEE FILED ITS O RIGINAL RETURN OF INCOME ON 24.09.2012 FOR A.Y. 2012-13 DECLARING TOTAL INCO ME AT / DATE OF HEARING : 13.06.2019 / DATE OF PRONOUNCEMENT: 20.06.2019 2 RS.10,42,587/-. A SURVEY U/S 133A OF THE ACT WAS CARRIED OUT ON THE ASSESSEE ON 05.10.2012 AND DURING THE SURVEY, ASSESSEE HAD AD MITTED ADDITIONAL INCOME OF RS.1,51,90,676/- ON ACCOUNT OF UNACCOUN TED SALES RECEIPTS. ASSESSEE THEREAFTER FILED ITS REVISED RETUR N OF INCOME ON 31.03.2013 DECLARING TOTAL INCOME OF RS.1,62,33,263/- WHICH INC LUDED ADDITIONAL INCOME OF RS.1,51,90,676/-. THEREAFTER, T HE CASE WAS SELECTED FOR SCRUTINY AND ASSESSMENT WAS FRAMED U/S 143 (3) OF THE ACT VIDE ORDER DT.25.02.2015 AND THE TOTAL INCOME WAS ASSESSED AT 1,62,33,263/-. ON THE ADDITIONAL INCOME OF RS.1,51,90,676/- DISCLOSED DURING THE SURVEY, AO VIDE PENALTY ORDER DT.21 .08.2015 PASSED U/S 271(1)(C) OF THE ACT LEVIED PENALTY OF RS. 45,57,203/-. AGGRIEVED WITH THE PENALTY ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE LD.CIT(A), WHO VIDE ORDER DT.27.01.2017 (IN APPEAL NO.PN/CIT(A)-13/ACIT, CIRCLE-9, PUNE/77/2016-17) DISMISSED THE APPEAL OF ASSESSEE. AGGRIEVED BY THE ORDER OF LD.CIT(A), A SSESSEE IS NOW IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS : 1. THE HONOURABLE COMMISSIONER OF INCOME-TAX (APPE ALS)- . 13.PUNE HAS ERRED IN DISMISSING THE APPEAL PREFERRE D BY THE APPELLANT- ASSESSEE AGAINST THE ORDER U/S.271(1)(C) DT.2.08.20 15 FOR A.Y.2012-13 PASSED BY THE ASSISTANT COMMISSIONER OF PASSED ' INCOME-TAX CIRCLE-9, PUNE, DT.21 . 08.2015 WHERE BY THE ASSESSING OFFICER HAS LEVIED PENALTY U/S.271(C) OF AN AMOUNT OF RS . 45,57,203/-. 2. THE HONOURABLE COMMISSIONER OF INCOME- TAX (APPEA L)-13 HAS ERRED IN DISMISSING THE APPEAL WITHOUT CONSIDERING THE FACTS AND LAW IN RESPECT OF LEVY OF PENALTY U/S . 271(1)(C) RAISED BY THE APPELLANT BEFORE HIM THROUGH GROUNDS OF APPEAL . 3. THE HONOURABLE COMMISSIONER OF INCOME-TAX (APPEAL )-13 HAS IS PALPABLY WRONG IN STATING THAT THE APPELLANT HAS NO T MADE ANY STATEMENT IN HIS DEFENCE . 4. THE HONOURABLE COMMISSIONER OF INCOME-TAX (APPEA LS) - 13 OUGHT TO HAVE APPRECIATED THAT THE ASSESSEE HAS FIL ED HIS REVISED RETURN U/S.139(4) IN TIME AND MANNER PROVIDED THERE IN AND NO INCOME WAS CONCEALED AS PER THIS RETURN AND THEREFORE QUESTION OF CONCEALING ANY PART OF INCOME DOES NOT ARISE ESPECIALLY WHEN THERE IS N O DIFFERENCE OR VARIATION IN THE INCOME DECLARED IN THE REVISED RETURN AND TH E ASSESSED INCOME 5. THE ASSESSING OFFICER SHOULD NOT HAVE INITIATED PENALTY PROCEEDINGS U/S.271(1)(C) , ESPECIALLY WHEN IN PARA 5 OF THE ASSESSMENT ORDER H AS 3 STATED THAT THE INCOME DECLARED IN THE REVISED INCO ME IS ACCEPTED 6. THE HONOURABLE COMMISSIONER OF INCOME TAX (APPEA LS)-13 SHOULD HAVE CONSIDERED THAT ONCE THE REVISED RETURN IS FILED WI THIN THE TIME ALLOWED BY THE ACT, THE CIRCUMSTANCES LEADING TO THE FILING OF REVISED RETURN IS NOT EVIDENCE RELEVANT TO THE ISSUE. 7. THE HONOURABLE COMMISSIONER OF INCOME-TAX (APPEAL )-13 SHOULD HAVE CONSIDERED THE POSITION IN LAW THAT THE STATEMENT MADE UNDER SECTION 131 RECORDED ON5-10-2012 DURING THE COURSE OF SURVEY U/S . 133A IS A CONFESSIONAL STATEMENT OF HAVING CONCEALED THE INCOME. 8. THE ASSESSING OFFICER SHOULD HAVE FAVOURABLY CON SIDERED THE SPIRIT OF THE STATEMENT IN TOTAL ESPECIALLY WHEN THE APPELLAN T ASSESSEE HAS STATED THAT HE HAS MADE THE DECLARAT I ON WITH A ' REQUEST NOT TO ISSUE PENALTY PROCEEDINGS AND INITIATE PENALTY. 9. THE APPELLANT ASSESSEE THEREFORE PRAYS THAT THE PENALTY U/S.27(1)(C) OF RS . 45,57,203/- LEVIED BY THE ASSESSING OFFICER AND CON FIRMED BY THE HONOURABLE COMMISSIONER OF INCOME TAX (APPEAL)-13 B E DELETED. 3. ALL THE GROUNDS BEING INTER-CONNECTED ARE CONSIDERED TOGETHE R. 4. ON THE DATE OF HEARING, NONE APPEARED ON BEHALF OF THE ASSESSEE NOR ANY ADJOURNMENT APPLICATION WAS FILED. WE THEREFORE PROCEED TO DISPOSE OF THE APPEAL EX-PARTE QUA THE ASSESSEE BASED ON THE MATERIAL AVAILABLE ON RECORD AND AFTER HEARING THE LD.D.R. 5. BEFORE US LD.D.R. SUPPORTED THE ORDER OF AO. 6. WE HAVE HEARD THE LD.D.R. AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT CASE IS WITH RESPECT TO LEVY OF PENALTY U/S 271(1)(C) OF THE ACT. IN THE PRESENT CASE, PENALTY OF RS.4 5,57,203/- HAS BEEN LEVIED ON ADDITION OF RS.1,51,90,676/- ON ACCOU NT OF UNACCOUNTED SALES RECEIPTS DISCLOSED DURING THE SURVEY. THE PERUSAL OF ASSESSMENT ORDER REVEALS THAT NO SATISFACTION HAS BE EN RECORDED BY THE AO AS TO WHETHER THE PENALTY HAS BEEN LEVIED ON AC COUNT OF FURNISHING OF INACCURATE PARTICULARS OF INCOME OR IT WAS A CA SE OF CONCEALMENT OF INCOME. THEREAFTER, IN THE PENALTY ORDER PA SSED U/S 4 271(1)(C) OF THE ACT, AO HELD THAT ASSESSEE HAD CONCEALED THE INCOME. IT IS A SETTLED LAW THAT WHILE LEVYING PENALTY FOR CONCEALME NT, THE AO HAS TO RECORD SATISFACTION AND THEREAFTER COME TO A FINDIN G IN RESPECT OF ONE OF THE LIMBS, WHICH IS SPECIFIED UNDER SECTION 271(1)(C) OF TH E ACT. THE FIRST STEP IS TO RECORD SATISFACTION WHILE COMPLETING THE ASSESSMENT AS TO WHETHER THE ASSESSEE HAD CONCEALED ITS INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOME. THEREAFTER, NOTICE U/S 27 4 READ WITH SECTION 271(1)(C) OF THE ACT IS TO BE ISSUED TO THE ASSESS EE. THE ASSESSING OFFICER THEREAFTER HAS TO LEVY PENALTY UNDER SEC TION 271(1)(C) OF THE ACT FOR NON-SATISFACTION OF EITHER OF THE LIMBS. WHILE COMPLETING THE ASSESSMENT, THE ASSESSING OFFICER HAS TO COME TO A FIN DING AS TO WHETHER THE ASSESSEE HAS CONCEALED ITS INCOME OR FURNISH ED INACCURATE PARTICULARS OF INCOME. THE HONBLE BOMBAY HIGH COURT IN CIT VS. SHRI SAMSON PERINCHERY REPORTED IN (2017) 392 ITR 4 (BOM) HELD THAT WHERE INITIATION OF PENALTY IS ONE LIMB AND THE LEVY OF PENALTY IS ON OTHER LIMB, THEN IN THE ABSENCE OF PROPER SHOW CAUSE NO TICE TO THE ASSESSEE, THERE IS NO MERIT IN LEVY OF PENALTY. 7. IN THE PRESENT CASE, AS NOTED HEREINABOVE, IT IS SEEN THAT THE AO HAS NOT RECORDED ANY SATISFACTION IN THE ASSESSMENT ORD ER BUT HAD LEVIED PENALTY FOR CONCEALMENT OF INCOME. CONSIDERING THE AFO RESAID FACTS IN THE LIGHT OF THE DECISION OF HONBLE BOMBAY HIGH CO URT IN THE CASE OF SAMSON PERINCHERY (SUPRA), WE ARE OF THE VIEW THAT IN THE PRESENT CASE THE BASIC CONDITION FOR LEVY OF PENALTY HAS N OT BEEN FULFILLED AND THAT THE PENALTY ORDER SUFFERS FROM NON-EXERCIS ING OF JURISDICTION POWER OF AO AND THEREFORE PENALTY ORDER CANN OT BE UPHELD. WE ACCORDINGLY SET ASIDE THE PENALTY ORDER PASSED BY A O. THUS, THE GROUNDS OF ASSESSEE ARE ALLOWED. 5 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED ON 20 TH DAY OF JUNE, 2019. SD/- SD/- ( SUSHMA CHOWLA ) ( ANIL CHATURVEDI ) ! / JUDICIAL MEMBER '! / ACCOUNTANT MEMBER PUNE; DATED : 20 TH JUNE, 2019. YAMINI #$%&'('% / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. 4. 5 6. CIT(A)-13, PUNE. PR.CIT-5, PUNE. '#$ %%&',) &', / DR, ITAT, B PUNE; $*+,/ GUARD FILE. / BY ORDER // TRUE COPY // -./%0&1 / SR. PRIVATE SECRETARY ) &', / ITAT, PUNE.