GREGORY & NICHOLAS, GOA V. ACIT CEN CIR 47, MUMBAI

ITSSA 91/MUM/2009

• Counselvise Citation: [2011] 124 COUNSELVISE.COM (IT) 8059 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 7 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 29-09-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 28-09-2011
• Assessment Year: misc
• Appeal Filed On: 22-12-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Block assessment

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, G, MUMBAI BEFORE SHRI R V EASWAR, PRESIDENT AND SHRI J SUDHAKAR REDDY, ACCOUNTANT MEMBER I T (SS) A NO: 91/MUM/2009 (BLOCK PERIOD : 01.04.1996 TO 18.02.2003) M/S GREGORY & NICHOLAS, GOA APPELLANT (PAN: AADFG2720Q) VS ASSISTANT COMMISSIONER OF INCOME TAX RESPONDENT CENTRAL CIRCLE 47, MUMBAI ASSESSEE BY: MR DHARMESH SHAH REVENUE BY: MR PAVAN VED DATE OF HEARING: 28 TH SEPTEMBER 2011 DATE OF PRONOUNCEMENT: 29 TH SEPTEMBER 2011 O R D E R R V EASWAR, PRESIDENT: THIS APPEAL BY THE ASSESSEE RELATES TO THE BLOCK P ERIOD 01.04.1996 TO 18.02.2003 AND IS DIRECTED AGAINST TH E PENALTY OF ` 51,00,000/- IMPOSED UNDER SECTION 158BFA(2) OF THE INCOME TAX ACT, 1961. 2. THE BRIEF FACTS IN THIS CONNECTION ARE THAT A BL OCK ASSESSMENT ORDER WAS PASSED ON 26.04.2006 IN THE CASE OF THE A SSESSEE UNDER SECTION 158BD OF THE ACT, DETERMINING THE TOTAL UND ISCLOSED INCOME AT 2 IT(SS)A NO: 91/MUM/2009 ` 80,73,120/-. THIS ORDER WAS APPEALED AGAINST BY TH E ASSESSEE BEFORE THE CIT(A). IT WOULD APPEAR THAT THERE WAS A DELAY IN FILING THE APPEAL. THE ASSESSEE SUBMITTED AN EXPLANATION BEFORE THE CI T(A) FOR THE DELAY. BRIEFLY, THE EXPLANATION WAS THAT THE BUSIN ESS WAS DISCONTINUED FROM 2003 DUE TO CONTINUED LOSSES, THAT THE PARTNER S WERE SITUATED AT DIFFERENT PLACES AND NOT AT ONE PLACE, THEY DID NOT HAVE ANY CONTACT OFFICE IN MUMBAI AND THAT IN THESE CIRCUMSTANCES NO PROPER STEPS COULD BE TAKEN IN TIME TO FILE THE APPEAL. THE CIT (A), IN HIS ORDER DATED 01.03.2007, REFUSED TO CONDONE THE DELAY AND ACCORD INGLY DISMISSED THE APPEAL IN LIMINE. AGAINST THE ORDER OF THE CIT (A) THE ASSESSEE FILED A FURTHER APPEAL TO THE TRIBUNAL IN ITA NO: 5102/MU M/2006 AND IT(SS)A NO: 24/MUM/2009. THE TRIBUNAL BY ORDER DAT ED 07.01.2011 HELD THAT THE CIT(A) OUGHT TO HAVE CONDONED THE DEL AY. THE TRIBUNAL ALSO EXAMINED THE MERITS OF THE ADDITION MADE IN TH E BLOCK ASSESSMENT AND FINALLY HELD THAT SINCE THE ADDITION WAS MADE A LSO IN THE REGULAR ASSESSMENT IT CANNOT BE BROUGHT TO TAX ONCE AGAIN I N THE BLOCK ASSESSMENT. IT FURTHER HELD THAT THE ADDITION ALRE ADY MADE IN THE REGULAR ASSESSMENT CANNOT BE TERMED AS A PROTECTIVE ADDITION. IN THIS VIEW OF THE MATTER THE ADDITION MADE IN THE BLOCK A SSESSMENT WAS DELETED. SO FAR AS THE REGULAR ASSESSMENT IS CONCE RNED, THE TRIBUNAL CONFIRMED THE ADDITION OF ` 80,73,120/-. A COPY OF THE SAID ORDER OF THE TRIBUNAL HAS BEEN FILED BEFORE US. 3 IT(SS)A NO: 91/MUM/2009 3. CONSEQUENT TO THE PASSING OF THE BLOCK ASSESSMEN T ORDER, THE ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS UND ER SECTION 158BFA(2) OF THE ACT. THE ASSESSEE MADE ELABORATE SUBMISSIONS IN RESPONSE TO THE SHOW CAUSE NOTICE BUT THEY WERE REJ ECTED BY THE ASSESSING OFFICER, WHO LEVIED THE IMPUGNED PENALTY BY ORDER DATED 16.10.2007. AGAINST THIS ORDER OF PENALTY, AN APPE AL TO THE CIT(A) OUGHT TO HAVE BEEN FILED ON OR BEFORE 30.11.2007 BU T IT WAS FILED ONLY ON 23.02.2009 AFTER A DELAY OF ONE YEAR, THREE MONT HS AND TWENTY THREE DAYS. THE CIT(A) REFUSED TO CONDONE THE DELA Y AND DISMISSED THE APPEAL IN LIMINE BY ORDER DATED 12.11.2009. 4. IT IS AGAINST THE AFORESAID ORDER THAT THE ASSES SEE HAS COME IN APPEAL BEFORE THE TRIBUNAL. SINCE THE TRIBUNAL IN ITS ORDER CITED SUPRA HAS CONDONED THE DELAY BEFORE THE CIT(A) OCCASIONED BY SIMILAR CIRCUMSTANCES, RESPECTFULLY FOLLOWING THE SAME LINE OF REASONING, WE CONDONE THE DELAY IN FILING THE APPEAL BEFORE THE C IT(A) AGAINST THE ORDER IMPOSING THE PENALTY. SINCE THE TRIBUNAL HAS ALSO DELETED THE ADDITION OF ` 80,73,120/- MADE IN THE BLOCK ASSESSMENT VIDE ITS O RDER DATED 07.01.2011 (SUPRA), THE PENALTY HAS NO LEGS T O STAND. WE HOLD ACCORDINGLY. THE LEARNED CIT DR, HOWEVER, SUBMITTE D THAT THE REVENUE IS CONTEMPLATING TO TAKE STEPS TO FILE A MI SCELLANEOUS APPLICATION BEFORE THE TRIBUNAL FOR RECTIFICATION O F ITS ORDER. HE THEREFORE PRAYED THAT WE MAY DEFER OUR DECISION TIL L THE MISCELLANEOUS APPLICATION TO BE FILED BY THE DEPARTMENT IS DISPOS ED OF. WE ARE NOT 4 IT(SS)A NO: 91/MUM/2009 INCLINED TO ACCEPT THE PRAYER. AS OF NOW NO MISCEL LANEOUS APPLICATION HAS BEEN FILED BY THE REVENUE. AS THINGS STAND TOD AY, THE ADDITION MADE IN THE BLOCK ASSESSMENT HAS BEEN DELETED BY TH E TRIBUNAL AND THE ORDER OF THE TRIBUNAL HOLDS THE FIELD. IN VIEW OF THE SAID ORDER THE PENALTY LEVIED UNDER SECTION 158BFA(2) CANNOT SURVI VE. WE THEREFORE CANCEL THE PENALTY. 5. IN THE RESULT, THE APPEAL IS ALLOWED WITH NO ORD ER AS TO COSTS. ORDER PRONOUNCED IN THE OPEN COURT ON 29 TH SEPTEMBER 2011. SD/- SD/- (J SUDHAKAR REDDY) (R V EASWAR) ACCOUNTANT MEMBER PRESIDE NT MUMBAI, DATED 29 TH SEPTEMBER 2011 SALDANHA COPY TO: 1. M/S GREGORY & NICHOLAS C/O CLUB CUBANA, ARPORA BARBEZ, GOA. 2. ACIT, CENTRAL CIRCLE 47, MUMBAI 3. CIT-CENTRAL IV, MUMBAI 4. CIT(A)-38, MUMBAI 5. DR G BENCH TRUE COPY BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI