RANKESH DIVYESH NAGAR ,SURAT V. .ACIT CENTRAL CIRCLE 1, SURAT

ITA 879/SRT/2024

AI Insights

The case involves Rankesh Divyesh Nagar, the appellant, who faced penalties under sections 271(1)(b) and 272A(1)(d) of the Income Tax Act for non-compliance with a notice issued under section 142(1). The penalties were levied for the assessment years 2012-13 to 2018-19. The appellant contested the penalties, arguing that the imposition for each year was based on a single default, which was unreasonable. The Tribunal considered the arguments and the precedent from a similar case involving Dimki Hemang Jhaveri, where it was ruled that only one penalty should be applied for a single default across multiple years.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 106905 (ITAT-SURAT)
• Duration Of Justice: 3 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-12-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2016-2017
• Appeal Filed On: 16-08-2024
• Other Referred Cases: Dimki Hemang Jhaveri in ITA No.704-710/SRT/2024, Smt. Anita Awasthi vs. ITO [2022] 143 taxmann.com 238 (Varanasi-Trib.)
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MUKESH JAIN
• Assessee Lawyers: UDAY P NANAVATI
• Section: 142(1)

Judgement Text

"आयकर अपीलीय अिधकरण, सूरत Ɋायपीठ, सूरत IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND SHRI BIJAYANANDA PRUSETH, ACCOUNTANT MEMBER आयकर अपील सं./ITA Nos. 875 to 881/SRT/2024 (AYs 2012-13 to 2018-19) (Physical court hearing) Rankesh Divyesh Nagar, 39, Ganesh Krupa Society, Opp: GAIL Tower, Rander Road, Surat-395 009 [PAN : AJGPD 4796 H] बनाम Vs Assistant Commissioner of Income-tax, Central Circle-1, Surat, Aayakar Bhavan, Majura Gate, Surat-395 001 अपीलाथŎ/Appellant ŮȑथŎ /Respondent िनधाŊįरती की ओर से /Assessee by Shri Uday P Nanavati, CA राजˢ की ओर से /Revenue by Shri Mukesh Jain– Sr-DR अपील पंजीकरण/Appeal instituted on 19.08.2024 सुनवाई की तारीख/Date of hearing 11.12.2024 उद ्घोषणा की तारीख/Date of pronouncement 1112.2024 Order under section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER: 1. This group of seven appeals by individual assessee are directed against the common order of Commissioner of Income Tax (Appeals)-4, Surat [for short to as “Ld.CIT(A)”] all dated 19.06.2024 for assessment years (AYs) 2012-13 to 2018-2019. The ld CIT(A) confirmed penalty levied by Assessing Officer (AO) under section 271(1)(b) in AYs 2012-13 to 2016-17 and under section 272A(1)(d) for AYs 2017-18 & 2018-19. In all appeals, the assessee has raised identical grounds of appeals, facts in all appeals are common. Therefore, with the consent of both the parties, all the appeals were clubbed, heard together and are decided by common order to avoid conflicting decision. For appreciation of fact, appeal for A.Y. 12-13, in ITA No.875/SRT/2024 is treated as “lead” case. The assessee has raised the following grounds of appeal:- ITA Nos.875-881/SRT/2024 (A.Ys.12-13 to 18-19) Rankesh Divesh Nagar 2 “1. The Learned CIT(A) has erred in upholding the action of the AO in levying penalty of Rs.10,000 for non-compliance of notice issued u/s 142(1) dated 07/12/202 u/s 271(1)(b) of the Act on misleading, baseless, arbitrary and perverse observations, is contrary to law and facts of the case and hence, liable to be deleted. 2. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal.” 2. Rival submission of both the parties have been heard and record perused. At the outset of hearing, Ld. Authorized Representative (Ld.AR) for the assessee submits that ground of appeal raised by assessee is covered by the decision of assessee’s group cases in Dimki Hemang Jhaveri in ITA No.704- 710/SRT/2024 dated 20.11.2024. The Assessing Officer levied penalty either under section 271(1)(b) or 272A(1)(d) for all seven years by treating a single default for all seven years and thereby levied penalties @ Rs. 10,000/- for all seven years by separate orders. Resultantly, penalty for Rs.70,000/- was levied. The Ld. AR of the assessee submits that it was only a single default. The ld AR of the assessee also filed copy of the decision of Tribunal in in Dimki Hemang Jhaveri (supra). 3. On the other hand, ld. Sr-DR for the Revenue after going through the contents of the order dated 20.11.2014 in Dimki Hemang Jhaveri (supra) submits that he relies on the order of lower authorities. 4. We have considered the rival submissions of both the parties and have gone through order of lower authorities carefully. We find that on similar set of facts, on similar grounds of appeal, this combination in assessees group case in in Dimki Hemang Jhaveri (supra) passed the following order; ITA Nos.875-881/SRT/2024 (A.Ys.12-13 to 18-19) Rankesh Divesh Nagar 3 “4. We have considered the rival submissions of both the parties and have gone through order of lower authorities carefully. We have also deliberated on various case laws relied by Ld. AR of the assessee. We find that there is no dispute that pursuant the search action, the AO was making assessment orders of current assessment year as well as for six years immediately prior to year in which action search was carried out. It is also matter of fact that AO issued a consolidated notice under section 142(1) of the Act dated 07.12.2022 for all assessment years. The Assessing Officer has given only five days’ time to make compliance. It is also undisputed fact that neither the assessee nor his representative attended or complied notice dated 07.12.2022 nor sought any adjournment. The AO considered a single default for initiation and levying penalty for default on a single occasion, but levied penalties in all years. Thereby treating it seven defaults on a single day. In our view, only it was a single default and imposing seven-time penalties i.e. in each and every year is unreasonable. Thus, penalty levied for single default is reasonable and for all remaining years is deleted. 5. The Ld. AR of the assessee strongly relied on the decision of Varanasi Tribunal in case of Smt. Anita Awasthi vs. ITO [2022] 143 taxmann.com 238 (Varanasi-Trib.) wherein similar penalties under section 271(1)(b) was deleted as re-assessment proceedings were quashed. However, facts in the present cases are at little variance. In the case of hand only addition was deleted and entire assessment proceedings are not quashed. 6 . To make this order clear, the penalty for initial assessment year i.e., assessment year 2012-13 is sustained and for remaining assessment years i.e., 2013-14 to 2018-19 penalties levied either under section 271(1)(b) or 272A(1)(d) of the Act are deleted. 7. In the result, assessee’s appeal ITA No.704/SRT/2024 is dismissed and remaining appeals ITA Nos.705-710/SRT/2024 are allowed.” 5. Considering the decisions of this bench in assesses group cases on similar penalty, wherein the penalty was sustained only in first year that is in AY 2012- 13 and for remaining assessment years i.e., 2013-14 to 2018-19 penalties levied either under section 271(1)(b) or 272A(1)(d) of the Act are deleted, ITA Nos.875-881/SRT/2024 (A.Ys.12-13 to 18-19) Rankesh Divesh Nagar 4 therefore following the principal of consistency the appal in ITA No. 875/Srt/2024 is dismissed and remaining appeals in ITA No. 876 to 881/Srt/2024 are allowed. 6. Registry is directed to place one copy of this order in all appeals folder / case file(s). Order pronounced in the open court on 11 /12/2024. Sd/- Sd/- (BIJAYANANDA PRUSETH) (PAWAN SINGH) लेखा सद˟/Accountant Member Ɋाियक सद˟/Judicial Member सूरत / Surat Dated: 11 /12/2024 Dkp Outsourcing Sr. P.S* आदेश कȧ ĤǓतͧलͪप अĒेͪषत/ Copy of the order forwarded to :  अपीलाथȸ/ The Appellant  Ĥ×यथȸ/ The Respondent  आयकर आयुÈत/ CIT  ͪवभागीय ĤǓतǓनͬध, आयकर अपीलȣय आͬधकरण, सूरत/ DR, ITAT, SURAT  गाड[ फाईल/ Guard File By order/आदेश से, // TRUE COPY // सहायक पंजीकार आयकर अपीलȣय अͬधकरण, सूरत "