Pooja Agarwal, Hyderabad, Hyderabad V. ITO, Ward-8(2), Hyderabad, Hyderabad

ITA 95/HYD/2017

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 2969 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 4 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-05-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 19-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: U MINICHANDRAN
• Assessee Lawyers: B SHANTHI KUMAR
• Keywords: Assessment record
• Section: 80C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A', HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA NO. 95/HYD/2017 ASSESSMENT YEAR: 2009-10 POOJA AGARWAL, HYD. PAN AGEPP 3602 K VS. INCOME-TAX OFFICER, WARD 8(2), HYDERABAD. APPELLANT RESPONDENT ASSESSEE BY: SHRI B. SHANTHI KUMAR REVENUE BY: SMT. U. MINICHANDRAN DATE OF HEARING: 16/05/2018 DATE OF PRONOUNCEMENT: 23/05/2018 O R D E R PER S. RIFAUR RAHMAN, AM: THIS APPEAL IS FILED BY THE ASSESSEE AGAINST ORDE R OF CIT(A) - 2, HYDERABAD, DATED 26/08/2016 WHEREBY CI T(A) CONFIRMED THE PENALTY LEVIED BY THE AO U/S 271(1)(C ) OF THE ACT. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT ASSESSEE, AN INDIVIDUAL, FILED HER RETURN OF INCOME FOR THE AY 2 009-10 ON 17/09/2009 DECLARING A TOTAL INCOME OF RS. 4,88,989 /-, WHICH INCLUDES INCOME FROM HOUSE PROPERTY OF RS. 3,69,600 /- AND ESTIMATED INCOME OF RS. 1,45,660/- FROM BUSINESS AN D INTEREST INCOME OF RS. 42,711/-. OUT OF THESE INCOMES, SOME DEDUCTION U/S 80C WAS CLAIMED AND FINALLY ARRIVED AT NET INCO ME OF RS. 4,88,990/-. 2.1 SUBSEQUENTLY, THE CASE WAS SELECTED FOR SCRUTIN Y AND ON VERIFICATION OF THE ASSESSMENT RECORD, THE AO FOUND THAT I.T.A. NO. 95/HYD/2017 SMT. POOJA AGARWAL 2 VARIOUS AMOUNTS TOTALLING TO RS. 26,97,000/- WERE F OUND CREDITED TO THE BANK ACCOUNT OF THE ASSESSEE. WHEN ASKED TO EXPLAIN, THE ASSESSEE SUBMITTED THAT THE RENTAL INC OME AND THE SALE PROCEEDS OF THE BUSINESS WERE DEPOSITED INTO T HE BANK ACCOUNT. SINCE THE ASSESSEE WAS UNABLE TO SUBSTANTI ATE HER ARGUMENT BY ADDUCING COGENT ARGUMENT AND ADDUCING P ROPER DOCUMENTARY EVIDENCE IN THE FORM OF BILLS AND NAME AND ADDRESS OF THE TENANTS, THE AO DISBELIEVED AND ADDE D THE ENTIRE AMOUNT TO THE INCOME RETURNED BY THE ASSESSE E. WHEN THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE TH E CIT(A), THE CIT(A) CONFIRMED THE ADDITION. EVEN ITAT CONFIR MED THE ADDITION, HOWEVER, DIRECTED THE AO TO REDUCE THE AM OUNT OF RS. 5,28,000/- CLAIMED TO HAVE BEEN RECEIVED AS REN TAL INCOME FROM THE ADDITION. 3. THEREAFTER, THE AO INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT ON THE GROUND THAT THE ASSESSE E HAD CONCEALED THE INCOME BY FURNISHING INACCURATE PARTI CULARS OF INCOME. ACCORDINGLY, A SHOW CAUSE NOTICE DATED 19/1 2/2013 WAS ISSUED TO THE ASSESSEE TO SHOW CAUSE AS TO WHY PENALTY U/S 271(1)(C) SHOULD NOT BE LEVIED FOR THE ADDITION MADE IN THE ASSESSMENT. THE ASSESSEE VIDE LETTER DATED 30/12/20 13 SUBMITTED THAT THOUGH HER ARGUMENT THAT ASSESSEE IS INVOLVED IN THE BUSINESS OF TRADING WAS NOT ACCEPTED EITHER AT ASSESSMENT STAGE OR AT APPELLATE STATE, THE FACT IS THAT THE ARGUMENT OF THE ASSESSEE WAS NOT DISPROVED BY THE DEPARTMENT AND THEREFORE, IT CANNOT BE SAID THAT TH E ASSESSEE HAS CONCEALED ANY INCOME NOR FURNISHED ANY INACCURA TE PARTICULARS OF INCOME. 4. THE AO AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE HELD THAT THE ASSESSEE MISERABLY FAILED TO ESTABLISH THE FACT THAT THE INCOME HAS NOT BEEN CONCEALED AND , I.T.A. NO. 95/HYD/2017 SMT. POOJA AGARWAL 3 THEREFORE, LEVIED A MINIMUM PENALTY OF RS. 8,00,000 /- U/S 271(1)(C) OF THE ACT, WHICH WAS CONFIRMED BY THE CI T(A) WHEN THE ASSESSEE PREFERRED AN APPEAL BEFORE HIM. 5. AGGRIEVED BY THE ORDER OF CIT(A), THE ASSESSEE I S IN APPEAL BEFORE US RAISING REGULAR GROUNDS OF APPEAL AND FILED A PETITION FOR ADMISSION OF FOLLOWING ADDITIONAL GRO UNDS: 1. THE LEARNED CIT(A) FAILED TO NOTE THAT THE AO DI D NOT SPECIFY THE REASON FOR LEVYING PENALTY U/S 271(1)(C ) OF THE IT ACT 1961 IN THE ASSESSMENT ORDER DT.23-12-20 09, AS TO WHETHER FOR CONCEALMENT OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. 2. THE LEARNED CIT(A) FAILED TO NOTE THAT THE AO DI D NOT SPECIFY THE REASON FOR LEVYING PENALTY U/S 271(1)(C ) OF THE IT ACT 1961 IN THE PENALTY ORDER DT.16-01-2014 AS TO WHETHER FOR CONCEALMENT OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. 3. THE LEARNED CIT(A) FAILED TO NOTE THAT THE AO DI D NOT SPECIFY THE REASON FOR LEVYING PENALTY U/S 271(1)(C ) OF THE IT ACT 1961 IN THE SHOW CAUSE NOTICE DT.19-12-2 013 AS TO WHETHER FOR CONCEALMENT OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. 6. AS THE SAID ADDITIONAL GROUNDS ARE LEGAL GROUNDS , WHEREIN, THE FACTS ARE ON RECORD AND FACTS DO NOT R EQUIRE FRESH INVESTIGATION, FOLLOWING THE DECISION OF HONBLE SU PREME COURT IN THE CASE OF NATIONAL THERMAL POWER CO., LIMITED VS. CIT 229 ITR 383 (SC), WE ADMIT THE SAID ADDITIONAL GROU ND OF ASSESSEE. 7. THE LD. AR OF THE ASSESSEE SUBMITTED THAT THE ASSESSING OFFICER INITIATED THE PENALTY PROCEEDINGS BY ISSUE OF A NOTICE U/S 274 R.W.S. 271(1)(C) ON 19.12.2013. HE SUBMITTED THAT WHILE ISSUING THE SAID NOTICE, THE ASSESSING O FFICER DID NOT MENTION WHETHER THE NOTICE IS ISSUED FOR CONCEA LMENT OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. THEREFORE, THE NOTICE IS NOT VALIDLY ISSUED. CONSEQ UENTLY, THE I.T.A. NO. 95/HYD/2017 SMT. POOJA AGARWAL 4 ORDER PASSED U/S 271(1)(C) ALSO IS NOT VALID. FOR T HIS PROPOSITION, HE RELIED ON THE DECISION OF THE HONB LE SUPREME COURT IN THE CASE OF CIT VS. SSAS EMERALD MEADOWS, [2016] 73 TAXMANN.COM 248 (SC). 8. THE LEARNED DEPARTMENTAL REPRESENTATIVE ON THE O THER HAND RELIED ON THE ORDERS OF REVENUE AUTHORITIES. 9. CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL FACTS ON RECORD. THE ISSUE IN DISPUTE IS S QUARELY COVERED BY THE DECISION OF THE HONBLE SUPREME COUR T IN THE CASE OF CIT VS. SSAS EMERALD MEADOWS, [2016] 73 TAXMANN.COM 248 (SC) WHEREIN THE APEX COURT UPHELD THE DECISION OF THE HONBLE HIGH COURT, IN WHICH, THE H ONBLE HIGH COURT CONFIRMED THE ORDER OF THE TRIBUNAL AND DISMI SSED THE APPEAL OF THE REVENUE, WHO CAME IN APPEAL AGAINST T HE ORDER OF THE TRIBUNAL. THE TRIBUNAL RELYING ON A DECISIO N OF KARNATAKA HIGH COURT IN CASE OF CIT VS. MANJUNATHA COTTON & GINNING FACTORY, [2013] 359 ITR 565/210 ALLOWED THE APPEAL OF THE ASSESSEE HOLDING THAT NOTICE ISSUED BY ASSES SING OFFICER U/S 274 READ WITH SECTION 271(1)(C) WAS BAD IN LAW, AS IT DID NOT SPECIFY UNDER WHICH LIMB OF SECTION 271( 1)(C) PENALTY PROCEEDINGS HAD BEEN INITIATED, I.E. WHETHER FOR CO NCEALMENT OF PARTICULARS OF INCOME OR FURNISHING OF INACCURAT E PARTICULARS OF INCOME. 9.1 IN THE CASE UNDER CONSIDERATION, ON PERUSAL OF THE SHOW CAUSE NOTICES ISSUED BY THE ASSESSING OFFICER U/S 2 74 R.W.S. 271 OF THE IT ACT, 1961, DATED 19/12/2013, WHICH IS PLACED ON RECORD VIDE PAGE 21 OF PAPER BOOK, IT IS SEEN THAT THE ASSESSING OFFICER DID NOT MENTION WHETHER THE NOTIC E IS ISSUED FOR CONCEALMENT OF INCOME OR FOR FURNISHING OF INAC CURATE PARTICULARS OF INCOME. THEREFORE, AS PER THE RATIO LAID DOWN BY I.T.A. NO. 95/HYD/2017 SMT. POOJA AGARWAL 5 THE HONBLE SUPREME COURT IN THE CASE OF SSAS EME RALD MEADOWS, THE NOTICE ISSUED BY THE ASSESSING OFFICER IS NOT VALID AND CONSEQUENTLY, THE ORDER PASSED U/S 271(1) (C) IS ALSO NOT VALID. HENCE, WE SET ASIDE THE ORDER OF THE CIT (A) AND QUASH THE ORDER PASSED BY THE ASSESSING OFFICER U/S 271(1)(C) OF THE ACT. ACCORDINGLY, THE APPEAL OF THE ASSESSEE IS ALLOWED. 10. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D. PRONOUNCED IN THE OPEN COURT ON 23 RD MAY, 2018. SD/- (P. MADHAVI DEVI) JUDICIAL MEMBER SD/- (S. RIFAUR RAHMAN) ACCOUNTANT MEMBER HYDERABAD, DATED 23 RD MAY, 2018 KV COPY FORWARDED TO: 1. SMT. POOJA AGARWAL, C/O B. SHANTHI KUMAR, ADVOCATE, 111, TARAMANDAL COMPLEX, 5-9-13, SAIFABAD, HYDERABA D - 004 2. ITO, WARD 8(2), SIGNATURE TOWERS, KONDAPUR, HYDERABAD 3. CIT(A) - 2, HYDERABAD 4. PR. CIT - 2, HYDERABAD 5. THE DR, ITAT, HYDERABAD 6. GUARD FILE