Shri Manubhai K. Naik, Surat V. The Dy.CIT.,Central Circle-1, Surat

ITSSA 336/AHD/2014

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 7232 (ITAT-SURAT)
• Duration Of Justice: 4 year(s) 10 month(s) 15 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 18-07-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 02-09-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Additional evidence; Set aside

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL SURAT BENCH, SURAT BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI O.P. MEENA, ACCOUNTANT MEMBER ITA NO.2495/AHD/2014 ASSESSMENT YEAR: 2008-09 SHRI MANUBHAI K NAIK, 18, SAMARPAN SOCIETY, NR.CHOKSIWADI, RANDER ROAD, SURAT 395 009. [PAN: AFOPN 4045 B] VS. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 1, SURAT. (APPELLANT) (RESPONDENT) IT(SS)A NOS.336 & 337/AHD/2014 ASSESSMENT YEARS : 2006-07 & 2008-09 SHRI MANUBHAI K NAIK, 18, SAMARPAN SOCIETY, NR.CHOKSIWADI, RANDER ROAD, SURAT 395 009. [PAN: AFOPN 4045 B] VS. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 1, SURAT. (APPELLANT) (RESPONDENT) O R D E R PER H.S. SIDHU, JM: THESE THREE APPEALS FILED BY THE ASSESSEE AGAINST THE SEPARATE IMPUGNED ORDERS PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-II, AHMEDABAD DATED 07.02.2014, 18.06.2014 PERTAINING TO ASSESSMENT YEARS 2008-09, 2006-07 AND 2007-08 RESPECTIVELY. ASSESSEE BY SHRI MEHUL K. PATEL AR DEPARTMENT BY SHRI PRASENJIT SINGH CIT(DR) & SHRI R.P.RASTOGI DATE OF HEARING 18.07.2019 DATE OF PRONOUNCEMENT 19.07.2019 2 2. GROUND RAISED BY THE ASSESSEE IN ITA NO.2495/AHD/2014 FOR A.Y. 2008-09 READS AS UNDER: 1. LD. CIT (A) ERRED IN LAW AND ON FACTS IN CONFIRMING PENALTY LEVIED BY AO OF RS. 4, 59, 67, 825/- UNDER SECTION 271(L)(C) OF THE ACT IGNORING THE EXPLANATION, DOCUMENTARY EVIDENCE AND CASE LAWS PLACED ON RECORD BY THE APPELLANT. LD. CIT (A) OUGHT TO HAVE DELETED PENALTY WHEN THE APPELLANT HAS NEITHER CONCEALED INCOME NOR FURNISHED INACCURATE PARTICULARS OF INCOME. IT BE SO HELD NOW. 2. LD. CIT (A) FURTHER ERRED IN LAW AND ON FACTS IN NOT CONSIDERING BINDING JUDGMENT OF THE HON'BLE JURISDICTIONAL HIGH COURT THAT AO HAS TO GIVE FIRM AND POSITIVE CLEAR CUT FINDING AS TO WHETHER THE APPELLANT HAS CONCEALED INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOME. LD. CIT (A) OUGHT TO HAVE DELETED PENALTY IN ABSENCE OF SUCH FIRM FINDING BY AO IN IMPUGNED PENALTY ORDER. IT BE SO HELD NOW. 3. LD. CIT (A) ERRED IN LAW AND ON FACTS IN CONFIRMING PENALTY LEVIED BY AO ON ADDITIONS MADE UNDER DEEMING PROVISIONS OF THE ACT. LD. CIT (A) OUGHT TO HAVE APPRECIATED THAT MERE NON ACCEPTANCE OF THE EXPLANATION DOES NOT TRANSLATE IN AUTOMATIC LEVY OF PENALTY DUE TO ADDITIONS BEING CONFIRMED IN QUANTUM PROCEEDINGS. IT BE SO HELD NOW. 4. LD. CIT (A) ERRED IN LAW AND ON FACTS IN IGNORING DETAILED REBUTTAL SUBMITTED BY APPELLANT TO REMAND REPORT TO CONFIRM PENALTY ON THE BASIS OF FINDINGS IN QUANTUM PROCEEDINGS WITHOUT APPRECIATING THE FACT THAT BOTH QUANTUM & PENALTY PROCEEDINGS ARE DISTINCT AND SEPARATE PROCEEDINGS. 5. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE ABOVE IT IS HEREBY RESPECTFULLY SUBMITTED TO SET ASIDE IMPUGNED PENALTY ORDER TO AWAIT OUTCOME OF DE NOVO APPELLATE ORDER IN QUANTUM PROCEEDINGS SET ASIDE BY THE HON'BLE BENCH VIDE ORDER DATED 04/04/2014 IN ITSS 310/AHD/2011 FOR QUANTIFICATION OF THE ADDITION THAT WOULD BE SUBJECT TO LEVY OF PENALTY. IT BE SO HELD NOW. 3. GROUND RAISED BY THE ASSESSEE IN IT(SS)A NO.336/AHD/2014 FOR A.Y. 2006-07 READS AS UNDER: 1. LD. CIT (A) ERRED IN LAW AND ON FACTS IN CONFIRMING PENALTY LEVIED BY AO OF RS. 4, 05,864/- UNDER SECTION 271(L)(C) OF THE ACT IGNORING THE EXPLANATION, DOCUMENTARY EVIDENCE AND CASE LAWS SUBMITTED IN APPELLATE PROCEEDINGS. LD. CIT (A) OUGHT TO HAVE DELETED PENALTY WHEN THE 3 APPELLANT HAS NEITHER FURNISHED INACCURATE PARTICULARS NOR CONCEALED INCOME. IT BE SO HELD NOW. 2. LD. CIT (A) FURTHER ERRED IN LAW AND ON FACTS IN IGNORING BINDING JUDGMENT OF HON'BLE JURISDICTIONAL HIGH COURT THAT AO HAS TO GIVE FIRM AND POSITIVE CLEAR CUT FINDING WHETHER THE APPELLANT HAD FURNISHED INACCURATE PARTICULARS OF INCOME OR CONCEALED PARTICULARS OF INCOME. LD. CIT (A) OUGHT TO HAVE DELETED PENALTY IN ABSENCE OF SUCH FIRM FINDING BY AO IN THE PENALTY ORDER. IT BE SO HELD NOW. 3. LD. CIT (A) ERRED IN LAW AND ON FACTS IN CONFIRMING PENALTY LEVIED BY AO BLINDLY FOLLOWING APPELLATE ORDER OF A Y 2008/09 PASSED ON 07/02/2014 IGNORING SUBSEQUENT ORDER OF HON'BLE ITAT DATED 04/04/2014 SETTING ASIDE QUANTUM APPEALS FOR PASSING DE NOVO APPELLATE ORDERS. LD. CIT(A) OUGHT TO HAVE HELD THE PENALTY PROCEEDINGS IN ABEYANCE TILL FRESH APPELLATE ORDERS WERE AVAILABLE QUANTIFYING INCOME OF APPELLANT. IT BE SO HELD NOW. 4. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE ABOVE IT IS HEREBY SUBMITTED TO THE HON'BLE BENCH TO SET ASIDE PENALTY PROCEEDINGS TO AWAIT FRESH APPELLATE ORDERS IN QUANTUM PROCEEDINGS AS DIRECTED BY THE HON'BLE BENCH. 4. GROUND RAISED BY THE ASSESSEE IN IT(SS)A NO.337/AHD/2014 FOR A.Y. 2007-08 READS AS UNDER: 1. LD. CIT (A) ERRED IN LAW AND ON FACTS IN CONFIRMING PENALTY LEVIED BY AO OF RS. 2,57,478/- UNDER SECTION 271(L)(C) OF THE ACT IGNORING EXPLANATION, DOCUMENTARY EVIDENCE AND CASE LAWS SUBMITTED IN APPELLATE PROCEEDINGS. LD. CIT (A) OUGHT TO HAVE DELETED PENALTY WHEN THE APPELLANT HAS NEITHER FURNISHED INACCURATE PARTICULARS NOR CONCEALED INCOME. IT BE SO HELD NOW. 2. LD. CIT (A) FURTHER ERRED IN LAW AND ON FACTS IN IGNORING BINDING JUDGMENT OF HON'BLE JURISDICTIONAL HIGH COURT THAT AO HAS TO GIVE FIRM AND POSITIVE CLEAR CUT FINDING WHETHER THE APPELLANT HAD FURNISHED INACCURATE PARTICULARS OF INCOME OR CONCEALED PARTICULARS OF INCOME. LD. CIT (A) OUGHT TO HAVE DELETED PENALTY IN ABSENCE OF SUCH FIRM FINDING BY AO IN THE PENALTY ORDER. IT BE SO HELD NOW. 3. LD. CIT (A) ERRED IN LAW AND ON FACTS IN CONFIRMING PENALTY LEVIED BY AO BLINDLY FOLLOWING APPELLATE ORDER OF A Y 2008/09 PASSED ON 07/02/2014 IGNORING SUBSEQUENT ORDER OF HON'BLE ITAT DATED 04/04/2014 SETTING ASIDE QUANTUM APPEALS FOR PASSING DE NOVO APPELLATE ORDERS. LD. CIT(A) OUGHT TO HAVE HELD THE PENALTY PROCEEDINGS IN ABEYANCE TILL FRESH APPELLATE ORDERS WERE AVAILABLE QUANTIFYING INCOME OF APPELLANT. IT BE SO HELD NOW. 4 4. ALTERNATIVELY AND WITHOUT PREJUDICE TO THE ABOVE IT IS HEREBY SUBMITTED TO THE HON'BLE BENCH TO SET ASIDE PENALTY PROCEEDINGS TO AWAIT FRESH APPELLATE ORDERS IN QUANTUM PROCEEDINGS AS DIRECTED BY THE HON'BLE BENCH. 5. AT THE TIME OF HEARING, THE LD.COUNSEL FOR THE ASSESSEE STATED THAT IN THE QUANTUM AGAINST WHICH THE PENALTY IN DISPUTE HAS BEEN LEVIED. THE ASSESSEE HAS FILED APPEALS BEFORE THE TRIBUNAL AGAINST THE ORDER OF LD.FIRST APPELLATE AUTHORITY WHO VIDE ORDER DATED 04.04.2014 HAS SET-ASIDE THE ISSUE INVOLVED IN THE QUANTUM APPEAL TO THE LD.FIRST APPELLATE AUTHORITY WHICH ARE PENDING BEFORE THE LD.FIRST APPELLATE AUTHORITY. HE REQUESTED THAT THESE ARE PENALTY APPEALS MAY ALSO BE SET-ASIDE TO THE LD.CIT(A) TO DECIDE THE SAME AFTER THE DECISION OF QUANTUM APPEALS PENDING BEFORE HIM. 6. THE LD.DEPARTMENTAL REPRESENTATIVE DID NOT RAISE ANY OBJECTION ON THE REQUEST OF THE LD.COUNSEL FOR THE ASSESSEE. 7. AFTER HEARING BOTH THE PARTIES AND PERUSING THE RELEVANT MATERIAL AVAILABLE ON RECORD, ESPECIALLY THE ORDER PASSED BY THE REVENUE AUTHORITIES ALONG WITH THE ORDER OF THE ITAT AHMEDABAD A BENCH PASSED IN THE CASE OF QUANTUM I.E. IT(SS)A NOS.308 TO 5 310/AHD/2011 FOR A.Y. 2006-07, 2007-08 AND 2008-09, MANUBHAI KALYANJI NAIK VS. DCIT, CC-1, SURAT DATED 04.04.2014. FOR THE SAKE OF CONVENIENCE THE RELEVANT PORTION OF THE SAME PARA 3 AND 4 ARE REPRODUCED AS UNDER : 3. WE HAVE CONSIDERED RIVAL SUBMISSION. WE FIND THAT THE ASSESSEE WAS COOPERATIVE IN THE MATTER OF HIS ASSESSMENT, AT THE ASSESSMENT STAGE BEFORE THE AO. HOWEVER, AT THE TIME OF HEARING OF THE APPEAL, NONE APPEARED ON BEHALF OF THE ASSESSEE. THE ASSESSEE HAS FILED A LETTER REQUESTING FOR FURTHER ADJOURNMENT IN THE MATTER BEFORE THE FIRST APPELLATE AUTHORITY, AND THE SAME WAS REJECTED BY THE CIT(A). THE CIT(A) HAS PASSED THE APPELLATE ORDER IN SUMMARY MANNER AND HAS NOT DEALT WITH THE ISSUES ON MERIT IN DETAIL. IN THESE FACTS OF THE CASE, WE ARE OF THE VIEW THAT IT SHALL BE IN THE INTEREST OF JUSTICE TO PROVIDE ONE MORE OPPORTUNITY TO THE ASSESSEE TO PLEAD ITS CASE BEFORE THE CIT(A), ACCORDINGLY, THE ISSUES IN THE GROUNDS OF THE APPEAL OF THE ASSESSEE FOR ALL THREE ASSESSMENT YEARS BEFORE US ARE RESTORED TO THE FILE OF THE CIT(AA) WITH DIRECTION TO PASS DE NOVO APPELLATE ORDER IN ACCORDANCE WITH LAW ON MERITS, AFTER ALLOWING DUE OPPORTUNITY OF HEARING TO BOTH THE PARTIES. THE CIT(A) IS FURTHER DIRECTED TO CONSIDER THE ADDITIONAL EVIDENCES SOUGHT TO BE FILED BY THE ASSESSEE BEFORE THE TRIBUNAL, AND DECIDE THE ISSUES BEFORE HIM AFTER CONSIDERING THE SAME. WE DIRECT ACCORDINGLY. 4. IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSE. 8. IN VIEW OF THE AFORESAID FINDINGS GIVEN BY THE ITAT AHMEDABAD A BENCH ORDER DATED 04.04.2014 IN THE QUANTUM APPEAL ON WHICH THE PENALTY IN DISPUTE HAS BEEN LEVIED WHICH IS PENDING BEFORE THE LD.CIT(A). IN THE INTEREST OF JUSTICE, WE SET-ASIDE THE ISSUE IN DISPUTE TO THE LD.CIT(A) TO DECIDE THE SAME ALONG WITH THE QUANTUM APPEAL PENDING BEFORE HIM AND DECIDE THE SAME AS PER LAW AFTER GIVING FULL OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THEREFORE, APPEALS OF THE 6 ASSESSEE IN ITA NO.2495/AHD/2014 FOR A.Y. 2008-09 IT(SS)A NO: 336/AHD/2014 FOR A.Y.2006-07 AND IT(SS)A NO:337/AHD/2014 FOR A.Y. 2007-08 ARE SET-ASIDE FOR STATISTICAL PURPOSE. 9. IN THE RESULT, THREE APPEALS FILED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED ON 19-07-2019. SD/- SD/- (O.P. MEENA) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 19/07/2019 / GANGADHARA RAO.S COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. PR.CIT 4. CIT(A) 5. DR / / TRUE COPY / / / / TRUE COPY / / ASST. REGISTRAR, ITAT, SURAT