M/s. Rajesh Singh Bhadoria, Bhopal V. THE ADDL. CIT (Range-1), Bhopal

ITA 972/IND/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 5713 (ITAT-INDORE)
• Duration Of Justice: 5 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-03-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 23-09-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MOHD JAVED
• Assessee Lawyers: JATIN SEHGAL
• Keywords: Reasonable cause
• Section: 143(3); 142(1); 2

Judgement Text

M/S. RAJESH SINGH BHADORIA /I.T.A. NO. 972/IND/2006 /A.Y.:11-12 PAGE 1 OF 3 , , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE . . , . . , ' BEFORE SHRI C.M.GARG, JUDICIAL MEMBER AND SHRI O.P.MEENA, ACCOUNTANT MEMBER . . ./I.T.A NO.972 /IND/2016 /ASSESSMENT YEAR : 2011-12 M/S. RAJESH SINGH BHADORIA S - 10, 2 ND FLOOR ARERA COLONY, BHOPAL VS. ADDL. CIT RANGE - 1 BHOPAL % /APPELLANT &'% /RESPONDENT . . ./PAN: AAKFR 2527 B % ( /APPELLANT BY SHRI JATIN SEHGAL , CA &'% ( /RESPONDENT BY SHRI MOHD. JAVED, SR. DR ( /DATE OF HEARING 20.03.2017 , ( /DATE OF PRONOUNCEMENT 20.03.2017 /O R D E R PER BENCH 1. THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF LEARNED COMMISSIONER OF INCOME-TAX (APPEALS)-I, BHOPAL [IN SHORT CIT(A)] DA TED 10.06.2016 PERTAINING TO ASSESSMENT YEAR 2011- 12, WHICH IN TURN HAS ARISEN FROM THE ORDER DATED 3 1.03.2014 UNDER SECTION 271(1)(B) OF INCOME TAX ACT,1961 (THE ACT) PASSED BY THE ADDL. CIT RGANGE -1, BHOPAL (IN SHORT THE AO) 2. IN THE GROUNDS OF APPEAL, THE ASSESSEE HAS ASSAILED THE ORDER OF LD. CIT (A) IN CONFIRMING THE PENALTY OF RS. 10,000/- LEVIED U/S. 271(1) (B) OF T HE ACT. 3. THE ASSESSEE IS A LAND DEVELOPER FIRM, FILED ITS RE TURN OF INCOME ON 23.01.2012 DECLARING TOTAL INCOME OF RS. 60,17,935/-. THE CASE WAS SELECTED UN DER SCRUTINY BY ISSUE OF FIRST NOTICE UNDER SECTION 143(2) AND SERVED ON 30.08.2012. THEREAFTER, NOTI CE UNDER SECTION 142(1) ISSUED ON 17.07.2013 FIXIN G DATE OF HEARING ON 25.07.2013. HOWEVER, SAME WAS N OT COMPLIED WITH NOR SHOW CAUSE NOTICE U/S. 274 READ WITH SECTION 271(1)(B) FOR 19.8.2013 WAS REPLI ED. AGAIN A SHOW CAUSE NOTICE U/S. 274 READ WITH M/S. RAJESH SINGH BHADORIA /I.T.A. NO. 972/IND/2006 /A.Y.:11-12 PAGE 2 OF 3 SECTION 271(1)(B) ISSUED FOR FIXING HEARING ON 31.0 3.2014. IN RESPONSE TO WHICH, IT WAS SUBMITTED THA T THE ASSESSEE COULD NOT APPEAR FOR HEARING DUE TO IN ADVERTENT OFFICE MISTAKE, THE NOTICE WAS MISPLACED AND THE LD. A.R. COULD NOT BE INFORMED. HOWEVER, T HIS EXPLANATION WAS NOT FOUND ACCEPTABLE BY THE AO AS BEING GENERAL IN NATURE AND WITHOUT SPECIFIC DET AILS AND NOT SUPPORTED BY DOCUMENTARY EVIDENCE. 4. BEING, AGGRIEVED THE ASSESSEE FILED AN APPEAL BEFOR E THE LD. CIT (A), WHO OBSERVED THAT THE ASSESSEE HIMSELF STATED THAT HE COULD NOT ATTENDED THE OFFICE OF THE AO AS NOTICE WAS MISPLACED NOR A NY ADJOURNMENT WAS SOUGHT. HENCE, LEVY OF PENALTY WAS CONFIRMED. 5. BEING, AGGRIEVED THE ASSESSEE FILED THIS APPEAL BEF ORE THE TRIBUNAL. THE LD. A.R. SUBMITTED THAT THE JUNIOR COUNSEL OF HIS OFFICE WENT TO THE AO ON 25.07.2013 AND VERBALLY FOR EXTENSION OF TIME DUE T O SICKNESS OF ACCOUNT OF THE ASSESSEE. THE AO WAS KIN D ENOUGH TO ALLOW TO SUBMIT THE REPLY AS SOON AS POSSIBLE . THE ORDER SHEET ENTRY DOES NOT MENTION THE NON-COMPLIANCE ON 25.07.2013. THE ASSESSEE ATTENDED ON 27.08.2013 AND SUBMISSIONS OF THE ASSE SSEE WERE TAKEN ON RECORD. THE ASSESSEE ALSO ATTENDED THE HEARING ON 31.03.2014 WITHIN FEW HOURS OF RECEIPT OF SHOW CAUSE NOTICE DTD. 30.03.2014 AND MADE SUBMISSIONS/ EXPLANATION. THE ASSESSEE AND HIS COUNSEL ATTEND THE HEARING DURING ASSESSMENT PROCEEDINGS AND SUBMITTED ALL DETAILS MAKING DUE CO MPLIANCE AND ASSESSMENT WAS MADE UNDER SECTION 143 (3) OF THE ACT. THEREFORE, SUBSEQUENT COMPLIANC E ARE CONSIDERED AS GOOD COMPLIANCE AND THE DEFAULT COMMITTED EARLIER IS IGNORED PENALTY CANNO T BE LEVIED. IN SUPPORT OF HIS CONTENTION THE LD. A .R. RELIED ON FOLLOWING DECISIONS: SHANKAR LAL SONI IND ORE V ACIT 13 ITJ 96(INDORE) , AKHIL BHARTIYA PRATH MIK SHIKSHAK BHAWAN TRUST V ADIT (2008) 115 TTJ 419 (DE L) / 115 ITJ 419 (DEL), PARMESHWARI TEXTILE V ITO 146 TAXMAN 38 (JD), SWARNABEN M KHANNA V DCIT 37 S OT 25 (AHD). 6. ON THE OTHER HAND, THE LD. D.R. RELIED ON THE ORDER S OF LOWER AUTHORITIES. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS OF BOTH THE PAR TIES AND HAVE PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE ASSESSEE ASSESSMENT IN THIS CASE WAS MADE UNDER SECTION 143 (3) OF THE ACT , WHICH MEANS THAT THERE WAS SUBSEQUENT COMPLIANCE TO THE NOTICES ISSUED BY THE AUTHORITIES. WE ALSO M/S. RAJESH SINGH BHADORIA /I.T.A. NO. 972/IND/2006 /A.Y.:11-12 PAGE 3 OF 3 NOTE THAT JUNIOR COUNSEL OF THE LD. A.R. ALSO ATTEN DED BEFORE THE AO AND SOUGHT EXTENSION OF TIME WHI CH WAS CLAIMED TO HAVE BEEN GRANTED ORALLY. THE AO VER BALLY AGREED BUT COUNSEL`S PRESENCE WAS NOT RECORDED , NOR THE ORDER SHEET ENTRY DTD. 25.07.20 13 RECORDS NON-COMPLIANCE. IF THAT BE SO, WE ARE O F THE VIEW THAT THE ASSESSEE HAD A REASONABLE CAUSE FOR NON-APPEARANCE ON THAT DAY. THEREFORE, THERE IS NO JUSTIFICATION FOR LEVYING THE PENALTY U/S 271(1) (B) OF THE ACT. SECONDLY, IN THIS MATTER, THE ASSES SMENTS HAVE BEEN COMPLETED U/S 143(3) OF THE ACT, THEREFOR E, NO PENALTY CAN BE LEVIED IF THE ASSESSMENTS HAVE BEEN COMPLETED U/S 143(3) DUE TO SUBSEQUENT COMPLIA NCES IN THE ASSESSMENT PROCEEDINGS WHICH WAS CONSIDERED AS GOOD COMPLIANCES AND DEFAULT COMMITTE D EARLIER WERE IGNORED. WE ALSO BOLSTER OUR VIEW BY PLACING RELIANCE IN THE CASE OF AKHIL BHARTIYA P RATHMIK SHIKSHAK SANGH BHAWAN TRUST V ADIT (2008) 115 TTJ 419 (DEL) / 115 ITJ 419(DEL) WHEREIN IT WAS HELD THAT WHERE THE ASSESSEE HAD NOT COMPLIED WITH NOTICE U/S 142(1) BUT ASSESSMENT ORDER WAS PASSED U /S 143(3) AND NOT U/S 144, THAT MEANT THAT SUBSEQUENT COMPLIANCE IN ASSESSMENT PROCEEDINGS WAS CONSIDERED AS GOOD COMPLIANCE AND DEFAULTS COMMITTED EARLIER WERE IGNORED BY THE ASSESSING OFF ICER, THEREFORE, LEVY OF PENALTY U/S 271(1)(B) OF T HE ACT WAS NOT JUSTIFIED. THUS, WE SET ASIDE THE ORDER S OF THE REVENUE AUTHORITIES AND DELETE THE LEVY OF PENALTY U/S 271(1)(B) OF THE ACT IN THIS APPEAL. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS AL LOWED. 9. THE ORDER PRONOUNCED IN THE OPEN COURT ON 20.03.201 7 SD/- SD/- ( . . )/(C.M. GARG) ( . . ) /(O.P.MEENA) /JUDICIAL MEMBER /ACCOUNTANT MEMBER DATED MARCH 20, 2017.