Akil Gulamali Somji,, Pune v. Additional Commissioner of Income-tax,,

ITA 1239/PUN/2014 | 2001-2002
Pronouncement Date: 28-09-2016 | Result: Allowed

Appeal Details

RSA Number 123924514 RSA 2014
Assessee PAN ADIPS8077Q
Bench Pune
Appeal Number ITA 1239/PUN/2014
Duration Of Justice 2 year(s) 3 month(s) 22 day(s)
Appellant Akil Gulamali Somji,, Pune
Respondent Additional Commissioner of Income-tax,,
Appeal Type Income Tax Appeal
Pronouncement Date 28-09-2016
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 28-09-2016
Date Of Final Hearing 20-09-2016
Next Hearing Date 20-09-2016
Assessment Year 2001-2002
Appeal Filed On 06-06-2014
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A PUNE BEFORE MS. SUSHMA CHOWLA JM AND SHRI ANIL CHATURVEDI AM . / ITA NO. 1 2 39 /PN/20 1 4 / ASSESSMENT YEAR: 2001 - 02 AKIL GULAMALI SOMJI SHOP NO.15 GULISTAN COMPLEX NEAR POONA COLLEGE PUNE 4110 0 1 . / APPELLANT PAN: A DIPS8077Q VS. THE A DDL . COMMISSIONER OF INCOME TAX RANGE 4 PUNE . / RESPONDENT RANGE 4 PUNE . / RESPONDENT / APPELLANT BY : NONE / RESPOND ENT BY : SHRI ANIL KUMAR CHAWARE / DATE OF HEARING : 20 .0 9 .201 6 / DATE OF PRONOUNCEMENT: 28 . 0 9 .201 6 / / ORDER PER SUSHMA CHOWLA JM: THIS APPEAL FILED BY THE ASSESSEE IS AGAINST ORDER OF CIT (A) - II PUNE DATED 1 0 . 0 1 .201 4 RELATING TO ASSESSMENT YEAR 2001 - 02 AGAINST PENALTY LEVIED UNDER SECTION 271D OF THE INCOME TAX ACT 1961 (IN SHORT THE AC T) . 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : - ITA NO . 1 2 39 /PN/201 4 AKIL GULAMALI SOMJI 2 1. IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED C.I.T.[A] HAS GROSSLY ERRED IN CONFIRMING THE PENALTY OF RS.20.00 LACS LEVIED BY THE LEARNED ASSESSING OFFICER U/S 27 1D OF THE I. T. ACT 1961 ON THE GROUND THAT THE APPELLANT HAS VIOLATED THE PROVISIONS OF SECTION 269SS OF THE I. T. ACT 1961. THE IMPUGNED ORDER PASSED BY THE LEARNED C. I. T.[A] BEING BAD IN LAW ARBITRARY PERVERSE AND DEVOID OF MERITS THE SAME MAY PLEASE BE VACATED AND THE IMPUGNED PENALTY MAY PLEASE BE DELETED. 2. IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED C. I. T.[A] HAS FAILED TO APPRECIATE THAT THE APPELLANT NEVER BORROWED ANY LOANS OF RS.20.00 LACS IN CONTRAVENTION OF THE PROVISIO NS OF SECTION 269SS OF THE I. T. ACT 1961 AS ALLEGED BY THE LEARNED ASSESSING OFFICER AND CONSEQUENTLY THE IMPUGNED PENALTY LEVIED BY THE LEARNED ASSESSING OFFICER WAS BAD IN LAW VOID AB INITIO WITHOUT JURISDICTION AND DEVOID OF MERITS AND HENCE THE LEARN ED C. I. T.[A] OUGHT TO HAVE CANCELLED THE IMPUGNED PENALTY. 3. THE APPEAL WAS FIXED FOR HEARING FROM DATE TO DATE I.E. ON 25.04.2016 13.07.2016 AND ON 01.09.2016 . T HE MATTER WAS BEING ADJOURNED AT THE REQUEST OF THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE SHRI SUNIL GANOO. HOWEVER ON 01.09.2016 HE WITHDREW HIS LETTER OF AUTHORITY. NOTICE WAS ISSUED TO THE PARTIES THROUGH RPAD. THE SAID NOTICE OF HEARING WAS SERVED UPON THE ASSESSEE AND THE ACKNOWLEDGEMENT OF RPAD IS FILED ON RECORD. HOWEV ER NONE APPEARED ON BEHALF OF THE ASSESSEE ON THE APPOINTED DATE OF HEARING I.E. APPEARED ON BEHALF OF THE ASSESSEE ON THE APPOINTED DATE OF HEARING I.E. 20.09.2016 NOR ANY APPLICATION WAS FILED FOR ADJOURNMENT. HENCE WE PROCEED TO DECIDE THE PRESENT APPEAL EXPARTE ASSESSEE AFTER HEARING THE LEARNED DEPARTMENTAL REPRESENTATI VE FOR THE REVENUE. 4. THE ISSUE WHICH ARISES IN THE PRESENT APPEAL IS AGAINST IMPOSITION OF PENALTY UNDER SECTION 271D OF THE ACT ON THE GROUND THAT THE ASSESSEE HAD VIOLATED THE PROVISIONS OF SECTION 269SS OF THE ACT. 5. BRIEFLY IN THE FACTS OF THE CA SE NOTICE UNDER SECTION 153C OF THE ACT WAS ISSUED TO THE ASSESSEE BEING PROPRIETOR OF M/S. ALNESH MOTORS. THE ASSESSEE EXPLAINED THAT THE SAID CONCERN WAS CLOSED SINCE 1999 AND NO OPERATIONS HAD TAKEN PLACE IN THE SAID FIRM SINCE THEN. THE ASSESSEE ALS O FURNISHED CERTIFICATE FROM THE BANK THAT THE CURRENT ACCOUNT OF THE SAID CONCERN WAS CLOSED ON 31.10.2000 SINCE THE BUSINESS COULD NOT BE CARRIED ON BECAUSE OF FINANCIAL ITA NO . 1 2 39 /PN/201 4 AKIL GULAMALI SOMJI 3 DIFFICULTIES. THE ASSESSEE FAILED TO FURNISH THE RETURN OF INCOME IN COMPLIANCE TO THE NOTICE UNDER SECTION 153C OF THE ACT. THE ASSESSING OFFICER HOWEVER NOTED THAT INFORMATION IN THE FORM OF SATISFACTION NOTE WAS RECEIVED CONSEQUENT TO SEARCH OPERATION UNDER SECTION 132 OF THE ACT IN THE CASE OF SHRI SHRIRAM H. SONI. IN VIEW OF THE INFORMATION RECEIVED THE ASSESSEE WAS ASKED TO FILE EXPLANATION IN RESPECT THEREOF AND THE ASSESSMENT WAS COMPLETED UNDER SECTION 153C R.W.S. 144 OF THE ACT. THEREAFTER THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A) WHO CONFIRMED THE SAID ASSESSMENT. ON SECOND APPEAL BEFORE THE TRIBUNAL THE CONTENTION OF ASSESSEE WAS THAT WHILE FRAMING THE SAID ASSESSMENT UNDER SECTION 153C OF THE ACT AGAINST THE ASSESSEE THE ASSESSING OFFICER HAD FAILED TO OBTAIN THE NECESSARY APPROVAL FROM THE JOINT COMMISSIONER OF INCOME TAX TO COMPLETE THE IMPUGNED ASSESSMENT ORDER AS PROVIDED UNDER SECTION 153D OF THE ACT. HENCE THE ASSESSMENT ORDER IN QUESTION WAS BAD IN LAW AND DESERVED TO BE ANNULLED AND THE OTHER PROPOSITIONS WERE ALSO RAISED IN THIS REGARD. THE TRIBUNAL I N ITA NOS.455 TO 458/PN/2010 RELATING TO ASSESSMENT YEARS 2001 - 02 TO 2004 - 05 ORDER DATED 30.03.2012 HELD THAT WHERE THE ASSESSING OFFICER HAS FAILED TO OBTAIN PRIOR APPROVAL UNDER SECTION 153D OF THE ACT BEFORE COMPLETING THE ASSESSMENT UNDER SECTION 153 C OF THE ACT THE SAME IS INVALID AND THE ASSESSMENT ORDER WAS THUS QUASHED AS NULL AND VOID. 6. AFTER THE ASSESSMENT ORDER WAS PASSED IN THE CASE OF ASSESSEE THE ASSESSING OFFICER WARD 4(5) PUNE MADE A REFERENCE TO THE ADDL. CIT RANGE - 4 PUNE FOR IN ITIATING PROCEEDINGS UNDER SECTION 271D OF THE ACT. SHOW CAUSE NOTICE WAS ISSUED TO THE ASSESSEE IN THIS REGARD ASKING THE ASSESSEE TO SUBMIT HIS EXPLANATION REGARDING ACCEPTANCE OF CASH LOANS AGGREGATING TO RS.20 LAKHS FROM SHRI SHRIRAM H. SONI WHICH WA S IN VIOLATION OF PROVISIONS OF SECTION 269SS OF THE ACT. VARIOUS INFORMATION WAS SOUGHT FROM THE ASSESSEE AND ALSO SUMMONS WERE ISSUED IN THIS REGARD. HOWEVER REJECTING THE PLEA OF ASSESSEE THE ADDL. CIT TOOK ITA NO . 1 2 39 /PN/201 4 AKIL GULAMALI SOMJI 4 NOTE OF THE FACT THAT EXPARTE ASSESSMENT WAS MADE UNDER SECTION 144 OF THE ACT AND THE APPEAL FILED BEFORE THE CIT(A) WAS DISMISSED. THE CONTENTION OF ASSESSEE THAT IT HAD CLOSED THE BUSINESS OF M/S. ALNESH MOTORS WAS ALSO NOTED BY THE ADDL.CIT. HOWEVER THE ENQUIRIES MADE BY THE ASSESSING OFFI CER WERE REFERRED AND THE ASSESSEE WAS HELD TO BE LIABLE FOR LEVY OF PENALTY UNDER SECTION 271D OF THE ACT AT RS.20 LAKHS. 7. BEFORE THE CIT(A) THE ASSESSEE FILED WRITTEN SUBMISSIONS WHICH ARE INCORPORATED UNDER PARA 3.2 AT PAGES 4 TO 9 OF APPELLATE OR DER. THE CLAIM OF ASSESSEE WAS THAT THERE WAS NO MERIT IN THE SAID LEVY OF PENALTY UNDER SECTION 271D OF THE ACT. THE CIT(A) IN VIEW OF THE MATERIAL BROUGHT ON RECORD WAS OF THE VIEW THAT THERE WAS CLEAR VIOLATION OF PROVISIONS OF SECTION 269SS OF THE A CT BY THE ASSESSEE AND HENCE LEVY OF PENALTY UNDER SECTION 271D OF THE ACT WAS UPHELD. 8. THE ISSUE WHICH NEEDS TO BE ADJUDICATED IN THE PRESENT APPEAL IS AGAINST 8. THE ISSUE WHICH NEEDS TO BE ADJUDICATED IN THE PRESENT APPEAL IS AGAINST SAID LEVY OF PENALTY UNDER SECTION 271D OF THE ACT. THE PROCEEDINGS AGAINST THE ASSESSEE WERE INITIATED UNDER SECTION 153C OF THE ACT PURSUANT TO INFORMATION RECEIVED FROM ANOTHER ASSESSING OFFICER WHO WAS IN - CHARGE OF SHRI SHRIRAM H. SONI WHOSE PREMISES WAS SEARCHED UNDER SECTION 132 OF THE ACT ON 29.07.2003. THE ASSESSEE WAS ISSUED NOTIC E UNDER SECTION 153C OF THE ACT BY THE ASSESSING OFFICER. HOWEVER THE ASSESSEE CLAIMED THAT IT HAD CLOSED ITS BUSINESS SINCE 1999 AND NO OPERATIONS WERE BEING CARRIED ON IN THE CONCERN M/S. ALNESH MOTORS WHOSE BANK ACCOUNT WAS ALSO CLOSED ON 31.10.2000. THE INFORMATION UNEARTHED THROUGH SEARCH ON SHRI SHRIRAM H. SONI WAS IN RELATION TO CERTAIN TRANSACTIONS BY SHRI SHRIRAM H. SONI WITH M/S. ALNESH MOTORS. THEREAFTER ASSESSMENT WAS COMPLETED IN THE HANDS OF ASSESSEE UNDER SECTION 153C R.W.S. 144 OF THE ACT WHICH HAS BEEN ANNULLED BY THE TRIBUNAL VIDE ORDER DATED 30.03.2012. IN SUCH CIRCUMSTANCES WHERE THE BASIS FOR INITIATING PROCEEDINGS UNDER SECTION 271D OF ITA NO . 1 2 39 /PN/201 4 AKIL GULAMALI SOMJI 5 THE ACT HAS BEEN ANNULLED BY THE TRIBUNAL THEN THE SAID INFORMATION CANNOT BE USED AGAINST TH E ASSESSEE SINCE THE INFORMATION GERMINATES FROM THE ASSESSMENT PROCEEDINGS WHICH ARE HELD TO BE NULL AND VOID. ONCE THE ASSESSMENT HAS BEEN HELD TO BE NULL AND VOID NO FURTHER PROCEEDINGS UNDER ANY OF THE PROVISIONS OF THE ACT WHICH ARE CONSEQUENT TO T HE INFORMATION GATHERED DURING THE COURSE OF ASSESSMENT PROCEEDINGS THOUGH INDEPENDENT OF THE PROCEEDINGS CANNOT H O LD THE ASSESSEE TO HAVE VIOLATED THE PROVISIONS OF SECTION 269SS OF THE ACT. ACCORDINGLY WE HOLD THAT THE ASSESSEE IS NOT LIABLE TO LEVY OF PENALTY UNDER SECTION 271D OF THE ACT AND THE SAME IS CANCELLED. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE THUS ALLOWED. 9 . IN THE RESULT APPEAL OF ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON THIS 28 TH DAY OF SEPTEMBER 201 6 . SD/ - SD/ - ( ANIL CHATURVEDI ) ( SUSHMA CHOWLA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; D ATED : 28 TH SEPTEMBER 201 6 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / T HE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT (A) - II PUNE ; 4. / THE CIT - II PUNE ; 5. / DR A ITAT PUNE; 6. / GUARD FILE . / BY ORDER // TRUE COPY // / SR. PRIVATE SECRETARY / ITAT PUNE