Shri Anil C.Radhanpara, Ahmedabad V. The Dy.CIT.,Cent,Circle-2(2), Ahmedabad

ITSSA 173/AHD/2015

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 6409 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 4 month(s) 21 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 18-10-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2008-2009
• Appeal Filed On: 28-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: L P JAIN
• Section: 271(1)(c); 274; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER & MS. MADHUMITA ROY, JUDICIAL MEMBER IT(SS)A NO. 173/AHD/2015 (ASSESSMENT YEAR : 2008-09) ANIL C. RADHANPURA, F-404, SHREEJI ENCLAVE, NR. ANANDNAGAR CROSS ROAD, SATELLITE, AHMEDABAD 380 015. VS. DCIT, CENTRAL CIRCLE 2(2), AHMEDABAD. [PAN NO. AEDPR 4879 K] ( APPELLANT ) .. ( RESPONDENT ) APPELLANT BY : MS. IRA KAPOOR, A.R. RESPONDENT BY : SHRI L. P. JAIN, SR. D.R. DATE OF HEARING 29/07/2019 DATE OF PRONOUNCEMENT 18/10/2019 O R D E R PER MS. MADHUMITA ROY - JM: THE INSTANT APPEAL FILED BY THE ASSESSEE IS DIRECTE D AGAINST THE ORDER DATED 27.03.2015 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) 12, AHMEDABAD ARISING OUT OF THE ORDER DATED 26.03.2013 PASSED BY THE DCIT, CENTRAL CIRCLE-2(2), AHMEDABAD UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED AS TO THE ACT) FOR THE ASSESSMENT YEAR 2008-09. 2. THE SHORT POINT INVOLVED IN THIS PARTICULAR CASE IS AS TO WHETHER THE PENALTY IS JUSTIFIABLE WHEN IT HAS BEEN LEVIED BY THE AO U/S 2 71(1)(C) OF THE ACT ALLEGING BOTH THE DEFAULTS OF CONCEALMENT OF INCOME AS WELL AS FURNIS HING OF INACCURATE PARTICULARS OF - 2 - IT(SS)A NO.173/AHD/2015 ANIL C. RADHANPURA VS. DCIT ASST.YEAR 2008-09 INCOME THOUGH THE SAME IS DISTINCT AND SEPARATE DEF AULTS. IN THIS CASE THE ASSESSMENT PROCEEDING FOLLOWING ADDITIONS WERE MADE ON 29.12.2 010 SET OUT. PENALTY NOTICE U/S 274 R.W.S 271(1)(C) WAS ISSUED. IT FURTHER APPEARS FROM THE PARAGRAPH 9 OF THE PENALTY ORDER DATED 26.03.2013 T HAT THE ASSESSEE HAS NOT BEEN ABLE TO PROVE THAT THE EXPLANATION HAS BEEN BONAFIDE AND AL L THE FACTS RELATING TO THE SAME AND THE MATERIALS TO THE COMPLETION OF TOTAL INCOME HAS BEE N DISCLOSED BY IT. THEREFORE, THE PENALTY HAS BEEN LEVIED FOR CONCEALMENT OF INCOME. IT IS ALSO EVIDENT FROM PARAGRAPH 6 OF THE IMPUGNED ORDER THAT BOTH THE ISSUE INVOLVING FURNISHING OF INACCURATE PARTICULARS OF I NCOME LEADING TO CONCEALMENT OF INCOME HAVE BEEN FRAMED BY THE LEARNED AO. THE ALLE GATION LEVELED AGAINST THE ASSESSEE NEEDS TO BE SPECIFIED EITHER ON THE COUNT OF CONCEA LMENT OF INCOME OR INACCURATE PARTICULARS OF INCOME WHICH HAS NOT BEEN CARRIED OU T AND HENCE THE ASSESSEE HAS MADE OUT A CASE FOR QUASHING OF THE ORDER IMPUGNED. LEARNED AR, IN THIS RESPECT ALSO RELIED UPON THE JUDGMENT PASSED BY THE HONBLE JURISDICTIONAL H IGH COURT IN THE MATTER OF SNITA TRANSPORT PVT. LTD-VS-ACIT REPORTED IN 42 TAXMANN.C OM 54; COPY WHEREOF HAS ALSO BEEN SUBMITTED BEFORE US. THE LEARNED AR ALSO RELIED UPO N THE JUDGMENT PASSED BY THE GUJARAT HIGH COURT IN THE CASE OF CIT-VS-JYOTI LTD. REPORTED IN [2013] 34 TAXMANN.COM 65 (GUJARAT) AND ALSO RELIED UPON THE ORDER PASSED BY THE HONBLE TRIBUNAL, AHMEDABAD BENCHES IN THE CASE OF DHARMESH DHULABHAI PRAJAPATI -VS-ITO IN ITA NO.1570/AHD/2017 FOR A.Y. 2011-12 AND ALSO THE CASE OF SMT. USHABEN ATULBHAI SHAH IN ITA NO.197/AHD/2017 FOR A.Y 2012-13. THE ORDER PASSED B Y THE HONBLE TRIBUNAL IN ITA NO.99/AHD/2017 FOR A.Y. 2008-09 HAS ALSO BEEN RELIE D UPON BY THE LEARNED AR. 3. WE HAVE HEARD THE RESPECTIVE PARTIES, WE HAVE AL SO PERUSED THE RELEVANT MATERIALS AVAILABLE ON RECORD. IT IS A FACT THAT THE ORDER IM POSING PENALTY HAS NOT SPECIFIED THE GUILT COMMITTED BY THE ASSESSEE. IN SIMILAR CIRCUMSTANCES THE CO-ORDINATE BENCH RELYING UPON - 3 - IT(SS)A NO.173/AHD/2015 ANIL C. RADHANPURA VS. DCIT ASST.YEAR 2008-09 THE ORDER PASSED BY THE HONBLE JURISDICTIONAL HIGH COURT QUASHED THE IMPUGNED ORDER OF PENALTY WITH THE FOLLOWING OBSERVATION: 4. WITH ASSISTANCE OF THE LD. REPRESENTATIVES, WE HAVE GONE THROUGH THE RECORD CAREFULLY. IN THE CASE OF SNITA TRANSPORT P.LTD. (S UPRA), HONBLE JURISDICTIONAL HIGH COURT HAS OBSERVED THAT WHILE ISSUING NOTICE UNDER SECTION 271(1)(C) R.W.S. 274 PROVIDE AN OPPORTUNITY TO EXPLAIN AS TO WHY PENALTY BE NOT IMPOSED. IF AN ASSESSING OFFICER USED EXPRESSION OR IN BETWEEN THE CONCEALMENT OF INCOM E/FURNISHING INACCURATE PARTICULARS, THEN THAT SHOW CAUSE NOTICE BE NOT FATAL TO THE PRO CEEDINGS, BUT WHILE VISITING THE ASSESSEE WITH PENALTY THE LD.AO OUGHT TO HAVE ITA N O.99/AHD/2017 - 3 - RECORDED A SPECIFIC FINDING, FOR WHICH BREACH, HE HAS VISITED THE ASSESSEE WITH PENALTY I.E. WHETHER HE HAS VISITED THE ASSESSEE WITH PENALTY FOR CONCEALME NT OF INCOME OR FURNISHING INACCURATE PARTICULARS OF INCOME. IN THE PENALTY ORDER HE CANN OT USE BOTH THE EXPRESSION. THE DISCUSSION MADE BY THE HONBLE COURT IN PARA-9 IS W ORTH TO NOTE. IT READS AS UNDER: 9. REGARDING THE CONTENTION THAT THE ASSESSING OFF ICER WAS AMBIVALENT REGARDING UNDER WHICH HEAD THE PENALTY WAS BEING IMPOSED NAME LY FOR CONCEALING THE PARTICULARS OF INCOME OR FURNISHING INACCURATE PART ICULARS, WE MAY RECORD THAT THOUGH IN THE ASSESSMENT ORDER THE ASSESSING OFFICE R DID ORDER INITIATION OF PENALTY ON BOTH COUNTS, IN THE ULTIMATE ORDER OF PE NALTY THAT HE PASSED, HE CLEARLY HELD THAT LEVY OF PENALTY IS SUSTAINED IN VIEW OF T HE FACT THAT THE ASSESSEE HAD CONCEALED THE PARTICULARS OF INCOME. THUS INSOFAR A S FINAL ORDER OF PENALTY WAS CONCERNED, THE ASSESSING OFFICER WAS CLEAR AND PENA LTY WAS IMPOSED FOR CONCEALING PARTICULARS OF INCOME. IN LIGHT OF THIS, WE MAY PERUSE THE DECISION OF THIS COURT IN CASE OF MANU ENGINEERING WORKS (SUPRA ). IN THE SAID DECISION, THE DIVISION BENCH CAME TO THE CONCLUSION THAT LANGUAGE OF 'AND/OR' MAY BE PROPER IN ISSUING A NOTICE FOR PENALTY, BUT IT WAS INCUMBE NT UPON THE ASSESSING AUTHORITY TO COME TO A POSITIVE FINDING AS TO WHETHER THERE W AS CONCEALMENT OF INCOME BY THE ASSESSEE OR WHETHER ANY INACCURATE PARTICULARS OF SUCH INCOME HAD BEEN FURNISHED BY THEM. IF NO SUCH CLEAR CUT FINDING IS REACHED BY THE AUTHORITY, PENALTY CANNOT BE LEVIED. IT WAS A CASE IN WHICH IN FINAL C ONCLUSION THE AUTHORITY HAD RECORDED THAT 'I AM OF THE OPINION THAT IT WILL HAV E TO BE SAID THAT THE ASSESSEE HAD CONCEALED ITS INCOME AND/OR THAT IT HAD FURNISH ED INACCURATE PARTICULARS OF SUCH INCOME.' IT WAS IN THIS RESPECT THE BENCH OBSE RVED THAT 'NOW THE LANGUAGE OF 'AND/OR' MAY BE PROPER IN ISSUING A NOTICE AS TO PENALTY ORDER OR FRAMING OF CHARGE IN A CRIMINAL CASE OR A QUASI-CRIMINAL CASE, BUT IT WAS INCUMBENT UPON THE IAC TO COME TO A POSITIVE FINDING AS TO WHETHER THE RE WAS CONCEALMENT OF INCOME BY THE ASSESSEE OR WHETHER ANY INACCURATE PARTICULA RS OF SUCH INCOME HAD BEEN FURNISHED BY THE ASSESSEE. NO SUCH CLEAR CUT FINDIN G WAS REACHED BY THE IAC AND, ON THAT GROUND ALONE, THE ORDER OF PENALTY PASSED B Y THE IAC WAS LIABLE TO BE STRUCK DOWN.' 5. IF THE PENALTY ORDER IS PERUSED IN THE LIGHT OF THE JUDGMENT OF HONBLE JURISDICTIONAL HIGH COURT, THEN IT WILL REVEAL THAT THE LD.AO WAS ITA NO.99/AHD/2017 - 4 - NOT SPECIFIC IN HIS FINDING FOR WHICH HE HAS VISITED THE ASSESSE E WITH PENALTY. THEREFORE, THIS ORDER IS - 4 - IT(SS)A NO.173/AHD/2015 ANIL C. RADHANPURA VS. DCIT ASST.YEAR 2008-09 NOT IN LINE OF LAW LAID DOWN BY THE HONBLE JURISDI CTIONAL HIGH COURT, AND HENCE NOT SUSTAINABLE. THE LD.CIT(A) HAS ERRED IN UPHOLDING T HIS ORDER OF THE AO. WE ALLOW THIS APPEAL OF THE ASSESSEE AND QUASH THE PENALTY ORDER. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . IN A NUT SHELL IT APPEARS FROM THE PENALTY ORDERS T HAT THE LEARNED AO HAS NOT LEVIED THE PENALTY ON THE SPECIFIC CHARGE AS MANDATED U/S 271 (1)(C) OF THE ACT. THE PRINCIPLES LAID DOWN BY THE HONBLE JURISDICTI ONAL HIGH COURT IN THE MATTER OF SIMILAR JUDGMENT SNITA TRANSPORT PVT. LTD. (SUPRA) ARE SQUARELY APPLICABLE TO THE FACTS AND CIRCUMSTANCES OF THE CASE IN HAND. AT THE COST OF R EPETITION WE OBSERVE THAT THE AO HAS NOT MENTIONED THE SPECIFIC CHARGE IN ITS PENALTY OR DER WHETHER IT WAS LEVIED FOR CONCEALMENT OF INCOME OR FOR FURNISHING INACCURATE PARTICULARS OF INCOME. THEREFORE, RESPECTFULLY RELYING UPON THE RATIO LAID DOWN BY TH E JURISDICTIONAL HIGH COURT, WE ARE OF THE OPINION THAT THE PENALTY LEVIED BY THE AO AND C ONFIRMED BY THE LEARNED CIT (A) IS NOT SUSTAINABLE IN THE EYE OF LAW. THE PENALTY, THE REFORE, IS DELETED. HENCE, THE GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. 4. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED. THIS ORDER PRONOUNCED IN OPEN COURT ON 18/10/2019 SD/- SD/- ( WASEEM AHMED ) ( MS. MADHUMITA ROY ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 18/10/2019 PRITI YADAV, SR.PS - 5 - IT(SS)A NO.173/AHD/2015 ANIL C. RADHANPURA VS. DCIT ASST.YEAR 2008-09 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. () / THE CIT(A)-GANDHINAGAR, AHMEDABAD. 5. , ! ' , #$%% / DR, ITAT, AHMEDABAD 6. &' () / GUARD FILE. / BY ORDER, //TRUE COPY// / ( DY./ASSTT.REGISTRAR) !, #$ / ITAT, AHMEDABAD 1. DATE OF DICTATION 15.10.2019 (COVERED CASE 2) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 15.10.2019 3. OTHER MEMBER. 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S 17.10.2019 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S. 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER