Shri Tilak Raj Bedi, Ludhiana V. DCIT, Central Circle 1, Ludhiana

ITA 976/CHANDI/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 7005 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 13-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GULSHAN RAJ
• Assessee Lawyers: PANKAJ BHALLA
• Keywords: Unexplained cash credit; Unexplained investment; Unexplained expenditure; Search and seizure; Deemed dividend
• Section: 69C; 153A; 147; 68; 69; 132; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE MS. DIVA SINGH, JUDICIAL MEMBER AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA NOS.976/CHD/2017 (ASSESSMENT YEAR : 2011-12) SH.TILAK RAJ BEDI, VS. THE D.C.I.T., PROP. M/S PUNEET EXPORTS INC., CENTRAL CIRCLE-1, C/O M/S V.V. BHALLA & CO., LUDHIANA. E-64, RISHI NAGAR, LUDHIANA. PAN: ADBPB3623N ITA NOS.1343 TO 1345/CHD/2016 (ASSESSMENT YEARS : 2008-09 TO 2010-11) M/S PUNEET FASHION PVT. LTD., VS. THE D.C.I.T., C/O PUNEET FASHION GROUP, CENTRAL CIRCLE-1, 854/2, PUNJAB MATA NAGAR, LUDHIANA. LUDHIANA. PAN: AAECP1579L (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI PANKAJ BHALLA, CA RESPONDENT BY : SHRI GULSHAN RAJ, CIT DR DATE OF HEARING : 01.08.2017 DATE OF PRONOUNCEMENT : 10.08.2017 ORDER PER BENCH : THIS BUNCH OF FOUR APPEALS RELATE TO TWO DIFFERENT ASSESSEES. THE APPEAL IN ITA NO.976/CHD/2017 RELAT ING TO ASSESSMENT YEAR 2011-12 HAS BEEN FILED AGAINST O RDER OF LD.CIT(APPEALS), BATHINDA DATED 22.3.2017 UPHOLD ING THE LEVY OF PENALTY U/S 271AAA R.W.S. 274 OF THE IN COME TAX ACT,1961, AND THE APPEALS RELATING TO ASSESSMEN T YEARS 2008-09 TO 2010-11 IN ITA NOS.1343 TO 1345/CHD/2016 HAVE BEEN FILED AGAINST SEPARATE ORDE RS OF LD.CIT(APPEALS), BATHINDA DATED 1.9.2016, UPHOLDING THE 2 LEVY OF PENALTY U/S 271(1)(C) R.W.S. 274 OF THE INC OME TAX ACT,1961 (IN SHORT THE ACT). 2. IT WAS COMMON GROUND BETWEEN BOTH THE PARTIES TH AT ALL THE ABOVE CASES INVOLVED COMMON FACTS & ISSUE A ND THEREFORE ALL THE CASES WERE HEARD TOGETHER AND AR E BEING DISPOSED OFF BY THIS COMMON ORDER. FOR THE SAKE OF CONVENIENCE WE SHALL BE DEALING WITH THE FACTS IN T HE CASE OF ITA NO.976/CHD/2017. ITA NO.976/CHD/2017 A.Y 2011-12 (TILAK RAJ BEDI PROP.M/S PUNEET EXPORTS INC.): 3. THE ISSUE INVOLVED IN THE PRESENT APPEAL PERTAIN S TO LEVY OF PENALTY U/S 271AAA OF THE INCOME TAX ACT, 1 961 (IN SHORT THE ACT). THE BRIEF BACKGROUND OF THE CASE , LEADING TO THE LEVY OF PENALTY IS THAT SEARCH AND SEIZURE O PERATION UNDER SECTION 132 OF THE ACT WAS CONDUCTED IN THE C ASE OF THE ASSESSEE ALONGWITH OTHER GROUP ENTITIES AND FAMILY MEMBERS COLLECTIVELY CALLED PUNEET FASHION GROUP ON 12.10.2 010. THE ASSESSEE DERIVED INCOME AS PROPRIETOR OF M/S PUNEET EXPORTS INC. AND INCOME FROM HOUSE PROPERTY. PURSUANT TO S EARCH AND IN RESPONSE TO NOTICE UNDER SECTION 153A OF THE ACT , RETURN DECLARING INCOME OF RS.65,05,310/- WAS FILED BY THE ASSESSEE. SUBSEQUENTLY, ASSESSMENT PROCEEDINGS WERE INITIATED IN WHICH THE ASSESSEE DID NOT COOPERATE, WITH VARIOUS NOTICE S BEING ISSUED TO IT REMAINING UNCOMPLIED WITH. THEREAFTER , OWING TO THE COMPLEXITY OF ACCOUNTS AND DOUBTS ABOUT THE COR RECTNESS OF THE ACCOUNTS, A SPECIAL AUDIT UNDER SECTION 142(2A) OF THE ACT WAS ORDERED, WHICH WAS ALSO HAMPERED BY THE NON COO PERATIVE ATTITUDE OF THE ASSESSEE. THE ASSESSING OFFICER, T HEREFORE, 3 PROCEEDED TO FRAME THE ASSESSMENT UNDER SECTION 144 OF THE ACT ON THE BASIS OF INFORMATION AVAILABLE AND HIS B EST JUDGMENT, MAKING ADDITIONS TOTALING RS. 29,04,18,89 9/- ON ACCOUNT OF UNDERSTATEMENT OF G.P RATE, CREDIT ENTRI ES IN THE BANK ACCOUNT MAINTAINED WITH ALLAHABAD BANK WHICH W AS CONSIDERED AS UNEXPLAINED CREDIT U/S 68 OF THE ACT, INTEREST CREDITED IN SAVING BANK A/C WITH ALLAHABAD BANK BEI NG CONSIDERED AS UNDISCLOSED INCOME U/S 69 OF THE ACT, ON ACCOUNT OF RECEIPT OF PAYMENT ON ACCOUNT OF COMPROM ISE OF COMPLAINT FILED U/S 138 OF NEGOTIABLE INSTRUMENTS A CT BEING CONSIDERED AS UNEXPLAINED EXPENDITURE CHARGEABLE U/ S 69C OF THE ACT, ON ACCOUNT OF JEWELLERY SEIZED DURING T HE SEARCH AND BEING CONSIDERED AS UNEXPLAINED INVESTMENT CHAR GEABLE TO TAX U/S 69A OF THE ACT, AND ON ACCOUNT OF LEDGER SEIZED DURING SEARCH WITH HEADING SUSPENSE ACCOUNT BEING CONSIDERED AS DEEMED DIVIDEND U/S 2(22)(E) OF THE A CT. 4. THE SAID EX-PARTE ORDER WAS CARRIED IN APPEAL BE FORE THE LD.CIT (APPEALS) WITH THE APPEAL BEING FILED BE YOND THE LIMIT PRESCRIBED UNDER SECTION 249(2)(B) OF THE ACT . THE ASSESSEE PLEADED FOR CONDONING THE DELAY CITING VAR IOUS REASONS RANGING FROM THE FAILURE OF THE ASSESSEES COUNSEL TO FILE THE APPEAL TO THE DIRE FINANCIAL CONDITION OF THE ASSESSEE. THE LD.CIT(A), HOWEVER, REFUSED TO CONDO NE THE DELAY AND TREATED THE APPEAL AS NOT MAINTAINABLE. AGAINST THE AFORESAID ORDER THE ASSESSEE FILED A RECTIFICAT ION APPLICATION UNDER SECTION 154/155 OF THE ACT. IN T HE MEANWHILE EVEN BEFORE THE DECISION OF THE QUANTUM A PPEAL 4 BEFORE THE LD.CIT (APPEALS) GOT DECIDED, PENALTY PR OCEEDINGS WERE INITIATED BY THE ASSESSING OFFICER. IN RESPON SE TO NOTICE ISSUED, THE ASSESSEE INITIALLY PLEADED IGNOR ANCE OF THE CIRCUMSTANCES UNDER WHICH THE NOTICE FOR PENALT Y PROCEEDINGS WAS ISSUED, PURSUANT TO WHICH COPIES OF ASSESSMENT ORDER AND NOTICES WERE SUPPLIED TO THE ASSESSEES REPRESENTATIVE. THEREAFTER THE ASSESSEE PLEADED THAT THE PENALTY PROCEEDINGS BE KEPT IN ABEYANCE TI LL THE DECISION OF THE FIRST APPELLATE AUTHORITY IN THE QU ANTUM CASE. HOWEVER, THE ASSESSING OFFICER REJECTED THE PLEA OF THE ASSESSEE AND PROCEEDED TO IMPOSE PENALTY AMOUNT ING TO RS.2,90,41,890/-. 5. AGAINST THE SAID ORDER THE ASSESSEE WENT IN APPE AL BEFORE THE LD.CIT (APPEALS) WHERE INITIALLY THE ASS ESSEE PLEADED BEFORE THE LD.CIT (APPEALS) THAT THE APPELL ATE PROCEEDINGS BE KEPT IN ABEYANCE TILL THE DISPOSAL O F THE RECTIFICATION APPLICATION MADE BEFORE THE LD.CIT (A PPEALS). NO SUBMISSIONS ON THE MERITS OF THE CASE WERE MADE. THE LD.CIT (APPEALS) SUMMARILY DISMISSED THE ASSESSEES APPEAL HOLDING THAT THE ELEMENT OF NON-COOPERATION WAS WRI T LARGE ON THE ENTIRE PROCEEDINGS PURSUANT TO SEARCH. LD CI T(A) FOUND NO MERIT IN THE ASSESSEES REQUEST FOR KEEPING THE ORDER IN ABEYANCE TILL THE DISPOSAL OF THE RECTIFIC ATION PROCEEDINGS, STATING THAT THE CONSEQUENCES OF THE RECTIFICATION PROCEEDINGS MAY OR MAY NOT LEAD TO RECONSIDERATION OF THE ISSUES, AGAINST BOTH OF WHIC H APPROPRIATE REMEDIES WERE AVAILABLE TO THE ASSESSEE . THE 5 RELEVANT FINDINGS OF THE LD.CIT (APPEALS) AT PARA 7 TO 9 OF HIS ORDER ARE AS UNDER: 7. AS SET OUT ABOVE, THE ELEMENT OF NON-COOPERATIO N IS WRIT LARGE ON THE ENTIRE PROCEEDINGS PURSUANT TO THE SEARCH. IT IS A MATTER OF RECORD THAT THE POST-SEARC H ASSESSMENT FOR ALL THE GROUP CASES INCLUDING THE CASE OF THE APPELLANT WAS FRAMED UNDER THE PROVISIONS OF SECTION 144 OF THE ACT. THEREAFTER, EVEN THE APPEAL AGAINST THE EX PARTE ORDER WAS FILED AFTER A CONSIDERABLE GAP, WHICH APPEAL WAS FOUND TO BE NON-MAINTAINABLE BY THE JURISDICTI ONAL APPELLATE COMMISSIONER BY A SPEAKING ORDER IN WHICH ALL THE SUBMISSIONS OF THE APPELLANT ARE SEEN TO HAVE BEEN DEALT WITH. THE APPELLATE COMMISSIONER HAS CLEARLY INDICATED IN THE ORDER HIS DISSATISFACTION ABOUT BOTH, THE GENUINENESS AS WELL AS THE SUFFICIENCY OF TH E GROUNDS PURPORTED TO HAVE BEEN CAUSATIVE OF THE DELAYED APPEAL. YET, INSTEAD OF FILING AN APPEAL AGAINST THAT ORDER BEFORE THE SECOND APPELLATE AUTHORITY FOR REDRESSAL OF THE GRIEVANCE, THE APPEL LANT, FOR REASONS BEST KNOWN TO IT, CHOSE TO FILE A RECTIFIC ATION PETITION AGAINST THAT ORDER ON THE SPECIOUS REASON T HAT JUDICIAL PRECEDENTS HAVE NOT BEEN FOLLOWED. THOUGH IT IS NOT INTENDED TO PREJUDGE THE EFFICACY OR THE PROBAB LE OUTCOME OF THE PENDING RECTIFICATION PETITION BEFORE THE JURISDICTIONAL APPELLATE COMMISSIONER, AS THIS APPELLATE AUTHORITY IS NOT SEIZED WITH THIS MATTER, IT CANNOT BUT BE FELT THAT THE APPELLANT IS OBSTRUCTIN G AND STONEWALLING THE FINALITY OF THE POST-SEARCH PROCEEDINGS BY NITPICKING AND ABUSING THE PROCESS OF LAW. 8. IT CANNOT BE GAINSAID THAT THE QUANTUM ASSESSMENT HAS A DIRECT BEARING ON THE PENALTY PROCEEDINGS AND THEREFORE THE OUTCOME OF APPEAL IN THE QUANTUM SHALL NECESSARILY DECIDE THE COURSE OF APPEAL IN RESPECT OF THE IMPUGNED PENALTY ORDER. SHOULD THE ASSESSEE NOW BECOME COOPERATIVE AND BE CONSCIOUS OF ITS OBLIGATIO NS AND DUTIES TOWARDS PAYING THE DUE TAXES OF THE GOVERNMENT, THE ENTIRE MATTER SHALL HAVE TO NECESSARI LY GO THROUGH THE ENTIRE RIGMAROLE ONCE AGAIN AS THE APPELLANT DID NOT AVAIL OF THE OPPORTUNITY BEFORE THE AO WHO, PERFORCE, PASSED AN EX PARTE ORDER. THERE HA S ALSO BEEN A SPECIAL AUDIT IN THE APPELLANT'S CASE. IN T HIS VIEW OF THE MATTER AND CONSIDERING THE ENTIRETY OF THE CIRCUMSTANCES, THE PLEA OF THE APPELLANT TO KEEP THE MATTER PENDING AND IN ABEYANCE TILL THE DISPOSAL OF TH E RECTIFICATION PETITION IS NOT CONSIDERED APPROPRIATE. ASSUMING THAT THE APPELLANT SUCCEEDS IN THE PENDING RECTIFICATION APPLICATION, THERE SHALL BE A CONSIDERA TION OF THE MATTER, NECESSARILY INVOLVING A REMAND BEFOR E THE AO, ONLY AFTER WHICH THE APPELLATE ORDER CAN BE PASSED. FURTHER ASSUMING THAT THE APPELLATE 6 PROCEEDINGS WOULD RESULT IN KNOCKING OFF THE ADDITIONS/DISALLOWANCES, THE AO SHALL HAVE TO RECAST THE PENALTY PURSUANT TO THE APPELLATE ORDER. SHOULD THE GRIEVANCE REGARDING PENALTY REMAIN, THE APPELLANT CA N THEN, AGAIN COME UP IN APPEAL. SAY IF THE APPELLANT DOES NOT SUCCEED WITH THE RECTIFICATION APPLICATION, HE ST ILL HAS AN AVENUE AT THE JURISDICTIONAL TRIBUNAL, WHOSE ORDER ALSO SHALL HAVE A BEARING ON THE PENALTY, WHICH CAN BE RE-WORKED OR RE-DECIDED. IT IS FOR THIS REASO N THAT THE APPELLANT'S REQUEST OF KEEPING THE APPELLATE PROCEEDINGS QUA THE IMPUGNED PENALTY ORDER IN ABEYANCE IS NOT CONSIDERED APPROPRIATE AND HENCE NO T ACCEDED TO. 9. NOW SINCE THE APPELLANT HAS NOT STATED ANYTHING I N SUPPORT OF THE APPEAL, IT IS HELD THAT HE HAS NOTHING T O SAY IN THIS REGARD. HENCE THE APPEAL IS DISMISSED. IT I S ORDERED ACCORDINGLY. 6. AGGRIEVED BY THE SAME THE ASSESSEE HAS COME UP I N APPEAL BEFORE US RAISING FOLLOWING GROUNDS OF APPEA L: 1. THAT THE LD. CIT(A), BATHINDA HAS WRONGLY PASSED THE ORDER U/S 250(6) OF THE INCOME TAX ACT, 1961 AGAINST LAW & FACTS OF THE CASE. 2. THAT THE LD CIT(A) HAD GRAVELY ERRED IN LAW AND F ACTS OF THE CASE IN CONFIRMING PENALTY U/S 271 (1) (C) OF THE INCOME TAX ACT, 1961 WITHOUT AFFORDING SUFFICIE NT OPPORTUNITY TO THE ASSESSEE. 3. THAT THE LD CIT(A) ERRED IN LAWS AND FACTS BY MO ST ARBITRARY REJECTING THE APPLICATION OF THE APPELLANT T O KEEP THE APPEAL AGAINST IMPUGNED PENALTY IN ABEYANCE TILL THE QUANTUM PROCEEDINGS ATTAINED FINALITY BEFORE THE JURISDICTIONAL COMMISSIONER (APPEALS). 4. THAT THE LD CIT(A) ERRED IN LAWS AND FACTS BY PROCEEDING TO DISPOSE OFF THE APPEAL OF APPELLATE I N A SUMMARY MANNER , BY REJECTING APPLICATION TO KEEP APPELLATE PROCEEDINGS IN ABEYANCE AND WITHOUT AFFORDING ANY OPPORTUNITY TO THE APPELLATE TO FILE SUBMISSIONS ON MERITS OF THE CASE. THUS THE ORDER PASSED IN GROSS VIOLATION TO THE PRINCIPLES OF NATUR AL JUSTICE I.E. AUDI ALTERAM PARTAM. 5. THAT THE LD CIT(A) FAILED TO APPRECIATE THAT THE A.O. DID NOT CARRY OUT A VALID SERVICE OF THE IMPUGNED NOTICE(S) U/S 271 (1) ( C) R.W. SEC 274 OF THE 'ACT' , HAD THEREIN GRAVELY ERRED IN LAW AND FACTS OF THE CASE IN ASSUMING JURISDICTION AND IMPOSING PENALTY U/S 271(1) (C) IN THE HANDS OF THE ASSESSEE. 6. THAT THE LD CIT(A) FAILED TO APPRECIATE THAT THE A O HAD GRAVELY ERRED IN LAW AND FACTS OF THE CASE BY MOST 7 ARBITRARILY IMPOSING PENALTY U/S 271(1) (C) ON THE BA SIS OF A NON-SPEAKING ORDER, WITHOUT ASSIGNING ANY REASON , MUCH THE LESS A COGENT REASON JUSTIFYING T HE IMPOSITION OF THE PENALTY IN THE HANDS OF THE ASSESSEE. 7. THAT THE LD CIT(A) FAILED TO APPRECIATE THAT THE AO HAD GRAVELY ERRED IN LAW & FACTS OF THE CASE BY MOST ARBITRARILY IMPOSING PENALTY U/S 271 (1) (C) IN THE HANDS OF THE ASSESSEE , SOLELY FOR THE REASON THAT ADDITIONS HAD BEEN MADE IN THE COURSE OF THE ASSESSMENT PROCEEDINGS. 8. THAT THE LD CIT(A) FAILED TO APPRECIATE THE AO HA D GRAVELY ERRED IN LAW AND FACTS OF THE CASE BY MOST ARBITRARILY IMPOSING PENALTY U/S 271(L)(C)WITHOUT RECORDING ANY INDEPENDENT REASON JUSTIFYING IMPOSITION OF THE SAME. 9. THAT THE LD CIT(A) AND THE AO EVEN OTHERWISE HAD GRAVELY ERRED IN LAW AND FACTS OF THE CASE IN CONFIRMING/IMPOSING THE IMPUGNED PENALTY U/S 271(1) (C) OF THE 'ACT' FOR A DEFAULT WHICH IS SEPAR ATE AND DISTINCT FROM THE ALLEGED ' DEFAULT ON THE BASIS O F WHICH THE PENALTY PROCEEDINGS HAD BEEN INITIATED IN THE BODY OF THE ASSESSMENT ORDER. 10. THAT THE LD CIT(A) FAILED TO APPRECIATE THAT THE AO HAD GROSSLY ERRED IN LAW AND FACTS OF THE CASE WHEREIN HE THOUGH ALLEGED THAT THE ASSESSEE HAD WILFULLY DISCLOSED 'INACCURATE PARTICULARS OF INCOME' , BUT THEREAFTER IMPOSED PENALTY IN HIS HANDS FOR' CONCEALMENT OF INCOME'. 11. THAT THE LD CIT(A) FAILED TO APPRECIATE THAT THE AO EVEN OTHERWISE HAD GRAVELY ERRED IN LAW AND FACTS OF THE CASE BY FAILING TO APPRECIATE THAT IN LIGHT OF THE NATURE OF ADDITIONS MADE IN THE HANDS OF THE ASSESSEE, NO PENALTY U/S 271(1) (C) WAS LIABLE TO BE IMPOSED. 12. THAT THE LD. CIT(A) FAILED TO APPRECIATE THAT THE AO HAD GRAVELY ERRED IN LAW AND FACTS F THE CASE BY IMPOSIN G PENALTY U/S 271(1)(C) ON THE BASIS OF AN ORDER MADE A S ON 27.05.2014, WITHOUT OBTAINING THE APPROVAL OF THE APPROPRIATING AUTHORITY, AS REQUIRED UNDER LAW. 7. DURING THE COURSE OF HEARING BEFORE US LD. COUNS EL FOR ASSESSEE POINTED OUT THAT THE ISSUE INVOLVED A ND THE FACTS IN THE PRESENT APPEAL WERE IDENTICAL TO THAT IN THE GROUP OF APPEALS DECIDED BY THE ITAT CHANDIGARH BEN CH ON 26.7.2017 WITH THE APPEAL TILAK RAJ BEDI VS DCI T IN ITA NO.1346/CHD/2016 BEING THE LEAD CASE. LD.COUNSE L 8 POINTED OUT THAT THE ITAT IN THOSE CASES HAD RESTOR ED THE APPEALS TO THE CIT(A) SINCE IT WAS FOUND THAT THE C IT(A) HAD NOT DEALT WITH THE GROUND CHALLENGING THE ASSUM PTION OF JURISDICTION TO PASS THE PENALTY ORDER AND ALSO THAT THE CIT(A) HAD NOT DEALT WITH THE GROUNDS RAISED BY THE ASSESSEE. THE LD. COUNSEL FOR ASSESSEE POINTED OUT THAT AS IN THE SAID CASE, IN THE PRESENT CASE ALSO THE LD.CIT(APPEALS) HAD FAILED TO ADDRESS THE LEGAL GRO UND RAISED BEFORE HIM BY THE ASSESSEE, OF ASSUMING JURISDICTION TO LEVY OF PENALTY WITHOUT OBTAINING T HE NECESSARY APPROVAL OF THE PRESCRIBED AUTHORITY AS P ROVIDED UNDER THE LAW. LD COUNSEL FOR THE ASSESSEE DREW OUR ATTENTION TO GROUND NO.7 OF THE GROUNDS OF APPEAL R AISED BEFORE THE LD.CIT(A) IN FORM NO.35 WHICH READ AS UN DER; 7. THAT THE AO HAD GRAVELY ERRED IN LAW AND FACTS OF THE CASE BY IMPOSING PENALTY U/S 271AAA ON THE BASIS OF AN ORDER MADE AS ON 26.05.2014,WITHOUT OBTAINING THE APPROVAL OF THE APPROPRIATE AUTHORITY, AS REQUIRED UNDER LAW. 8. THE LD. COUNSEL FOR THE ASSESSEE STATED THAT THE LD.CIT (APPEALS) HAD NOT DEALT WITH THIS GROUND RAISED BY THE ASSESSEE. THE LD. COUNSEL FOR THE ASSESSEE POINTED OUT THAT AS PER THE PROVISIONS OF SECTION 274 SUB-SECTION (2 ), NO ORDER IMPOSING PENALTY COULD BE MADE BY THE ASSISTA NT COMMISSIONER WHERE THE PENALTY EXCEEDS RS.20,000/- EXCEPT WITH THE PRIOR APPROVAL OF THE JOINT COMMISS IONER. LD COUNSEL FOR THE ASSESEE POINTED OUT THAT IN THE PRESENT CASE, PENALTY AMOUNTING TO RS.2,90,41,890/- HAD BEE N LEVIED BY THE DEPUTY COMMISSIONER OF INCOME TAX. TH E LD. 9 COUNSEL FOR THE ASSESSEE THEREAFTER DREW OUR ATTENT ION TO THE DECISION OF THE COORDINATE BENCH OF THE I.T.A.T . IN THE CASE OF LATE SHRI GYAN CHAND JAIN VS. ITO IN ITA NO.53/JP/2011 DATED 7.3.2014 WHEREIN THE NECESSITY OF OBTAINING APPROVAL FROM THE REQUISITE AUTHORITY UND ER SECTION 274 WAS UPHELD AND IN THE ABSENCE OF THE SA ME THE PENALTY ORDER WAS HELD NOT TO BE A LEGAL ORDER IN T HE EYES OF LAW. THE LD. COUNSEL FOR THE ASSESSEE, THEREFORE, PRAYED THAT THE MATTER BE RESTORED TO THE LD.CIT (APPEALS ) FOR RECONSIDERATION. 9. THE LD. D.R. FAIRLY ADMITTED THAT THE LD.CIT (AP PEALS) HAD NOT DEALT WITH THE AFORESAID GROUNDS RAISED BY THE ASSESSEE IT. 10. WE HAVE HEARD BOTH THE PARTIES. WE HAVE ALSO GONE THROUGH THE ORDER OF THE ITAT IN GROUP OF CASES WIT H THE LEAD CASE IN ITA NO.1346/CHD/2016 DATED AND FIN D THAT ON IDENTICAL SET OF FACTS THE I.T.A.T. HAD RESTORED THE APPEAL BACK TO THE LD.CIT (APPEALS) FOR PASSING A SPEAKING ORDER ON ALL THE GROUNDS RAISED BY THE ASSESSEE SINCE IT WAS FOUND THAT THE ASSESSEES APPEAL HAD BEEN SUMMARILY DISMI SSED BY THE CIT(A), WITHOUT DEALING SPECIFICALLY WITH ALL THE GROUNDS RAISED BY THE ASSESSEE AND MORE PARTICULARL Y NOT DEALING WITH THE JURISDICTIONAL GROUND RAISED BY TH E ASSESSEE OF ASSUMING JURISDICTION UNDER SECTION 147 WITHOUT OBTAINING NECESSARY APPROVAL FROM THE JCIT AS REQUIRED BY THE STATUTE UNDER SECTION 274 OF THE AC T. THE 10 RELEVANT FINDINGS OF THE I.T.A.T. AT PARAS 10 AND 1 1 OF ITS ORDER ARE AS UNDER: 10. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE ORDERS OF THE AUTHORITIES BELOW. WE FIND MERIT IN THE CONTENTIONS OF THE LD.COUNSEL FOR THE ASSESSEE. UNDOUBTEDLY IN THE PRESENT CASE PENALTY U/S 271(1)(C) AMOUNTING TO RS.1,48,53,626/- HAS BEEN LEVIED BY THE DCIT. SECTION 274 OF THE ACT, MANDATES APPROVAL OF THE JOINT COMMISSIONER OF INCOME TAX, WHERE PENALTY LEVIED BY THE DCIT EXCEEDS 20,000/-.THE ASSESSEE ,WE FIND, HAD RAISED THE GROUND BEFORE THE CIT(A) CHALLENGING THE ASSUMPTION OF JURISDICTION BY THE DCIT TO LEVY PENALTY. THE LD CIT(A) ,WE FIND, DISMISSED THE ASSESSEES APPEAL WITHOUT DEALING WITH THE LEGAL GROUND RAISED BEFORE IT. INTERESTINGLY WE FIND THA T THE LD.CIT(A) HAS MADE A PASSING REFERENCE TO THIS ISSUE IN HIS ORDER AT PARA 5,WHILE NARRATING THE FACTS OF THE CASE, STATING THAT APPARENTLY THE STATUTORY APPROVAL WAS TAKEN AFTER THE PASSING OF THE ORDER IMPOSING PENALTY WHICH EVIDENTLY WAS INCORRECTLY DATED. THE RELEVANT PORTION OF THE ORDE R IS AS UNDER: PENALTY OF RS.1,48,53,626/-WAS,THUS,LEVIED VIDE ORDER DATED 27/05/2014,EVEN THOUGH IT IS STATED THAT APPROVAL FOR THE SAID ORDER WAS ACCORDED BY THE ADDITIONAL COMMISSIONER ON 30/05/2014. EVIDENTLY, THE AO HAS DATED HIS PENALTY ORDER INCORRECTLY. 11. THE AFORESAID OBSERVATION OF THE LD.CIT(A), WITHOUT CORROBORATING THE FACTS OF THE CASE FROM THE RECORDS, DOES NOT TANTAMOUNT TO ADJUDICATING THE ISSUE OF ASSUMPTION OF JURISDICTION. FURTHER W E FIND THAT THE LD.CIT(A) DISMISSED THE ASSESSEES APPEAL SUMMARILY WITHOUT DEALING WITH THE SPECIFIC GROUNDS, NUMBERING IN ALL TO 12, RAISED BY THE ASSESSEE. WE THEREFORE CONSIDER IT FIT THAT THE APPEAL BE RESTORED BACK TO THE LD.CIT (APPEALS) FOR PASSING A SPEAKING ORDER DEALING WITH ALL THE GROUNDS RAISED BY THE ASSESSEE. WE FURTHER DIRECT THAT THE ASSESSEE BE GIVEN DUE OPPORTUNITY OF HEARING. IN VIEW OF THE ABOVE, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 11. SINCE THE FACTS AND CIRCUMSTANCES IN THE PRESEN T CASE ARE IDENTICAL TO THAT IN ITA NO.1346/CHD/2016, THE DECISION RENDERED THEREIN WILL SQUARELY APPLY TO THE PRESENT CASE ALSO FOLLOWING WHICH WE RESTORE THE ABOVE APPEALS T O THE 11 LD.CIT (APPEALS) WITH DIRECTIONS TO PASS SPEAKING O RDER ON ALL THE GROUNDS RAISED BY THE ASSESSEE AND AFTER P ROVIDING DUE OPPORTUNITY OF HEARING TO THE ASSESSEE. 12. THE APPEAL OF THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSES. ITA NOS.1343 TO 1345/CHD/2016 13. IT IS RELEVANT TO OBSERVE HERE THAT THE FACTS AND CIRCUMSTANCES OF THESE APPEALS ARE SIMILAR TO THE F ACTS AND CIRCUMSTANCES IN ITA NO.1075/CHD/2014 AND THE FINDINGS GIVEN IN ITA NO.1075/CHD/2014 SHALL APPLY MUTATIS MUTANDIS TO THESE APPEALS ALSO. 14. IN THE RESULT, ALL THE APPEALS OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (DIVA SINGH) (ANNAPURNA GUPTA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 10 TH AUGUST, 2017 *RATI* COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. THE CIT 5. THE DR ASSISTANT REGISTRAR, ITAT, CHANDIGARH