M/s KRS Estate(P)Ltd., Varanasi v. ACIT,, Varanasi

ITA 216/ALLD/2014 | 2005-2006
Pronouncement Date: 30-04-2015 | Result: Allowed

Appeal Details

RSA Number 21620714 RSA 2014
Assessee PAN AACCK4008P
Bench Allahabad
Appeal Number ITA 216/ALLD/2014
Duration Of Justice 1 year(s) 5 day(s)
Appellant M/s KRS Estate(P)Ltd., Varanasi
Respondent ACIT,, Varanasi
Appeal Type Income Tax Appeal
Pronouncement Date 30-04-2015
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted DB
Tribunal Order Date 30-04-2015
Assessment Year 2005-2006
Appeal Filed On 24-04-2014
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL ALLAHABAD BENCH ALLAHABAD BEFORE SHRI D. KARUNAKARA RAO ACCOUNTANT MEMBER AN D SHRI C. N. PRASAD JUDICIAL MEMBER ITA NO. 216 TO 220/A/2014 A.Y. 2005-06 TO 2009-10 M/S. KRS ESTATE PVT. LTD. VS. ASSTT. COMMISSION ER OF INCOME TAX 36-A RAVINDRAPURI CENTRAL CIRCLE BHELUPUR VARANASI VARANASI (PAN: AAACCK4008P) (APPELLANT) (RESPONDENT) ITA NO. 191 & 192/A/2014 A.Y. 2008-09 & 2009-10 MANISH KUMAR DIDWANIA (HUF) VS. ASSTT. COMMI SSIONER OF INCOME TAX H-36A LANE NO.5 RAVINDRAPURI CENTRAL CIRCLE VARANASI VARANASI (PAN: AAHHM8874R) (APPELLANT) (RESPONDENT) ITA NO. 196/A/2014 A.Y. 2010-11 (SMT.) SITA DEVI DIDWANIA VS. ASSTT. COMMISS IONER OF INCOME TAX HOUSE NO.44-A LANE NO.5 CENTRAL CIRCLE RAVINDRAPURI VARANASI VARANASI (PAN: ABTPD8400D) (APPELLANT) (RESPONDENT) ITA NO. 209/A/2014 A.Y. 2010-11 (SMT) KUSUM DEVI DIDWANIA VS. ASSTT. COMMISSIO NER OF INCOME TAX B-27/86 DURGAKUND ROAD CENTRAL CIRCLE BHELUPUR VARANASI VARANASI (PAN: ABXPD2175P) (APPELLANT) (RESPONDENT) ITA NO. 216 TO 220/A/2014 A.Y. 2005-06 TO 2009-10 2 ITA NO. 238 TO 242/A/2014 A.Y. 2004-05 TO 2008-09 SHIV SHANKAR DIDWANIA (HUF) VS. ASSTT. COMMISSION ER OF INCOME TAX HOUSE NO.36A LANE NO.5 CENTRAL CIRCLE RAVINDRAPURI VARANASI VARANASI (PAN: AAOHS9816C) (APPELLANT) (RESPONDENT) ITA NO. 179 TO 184/A/2014 A.Y. 2004-05 TO 2009-10 RAJ KUMAR DIDWANIA (HUF) VS. ASSTT. COMMISSIONE R OF INCOME TAX B-27/86-A DURGAKUND CENTRAL CIRCLE VARANASI VARANASI (PAN: AAJHR6125G) (APPELLANT) (RESPONDENT) ITA NO. 185 & 186/A/2014 A.Y. 2009-10 & 2010-11 PAWAN KUMAR DIDWANIA VS. ASSTT. COMMISSIONER OF INCOME TAX B-27/86A DURGAKUND ROAD CENTRAL CIRCLE BHELUPURA VARANASI VARANASI (PAN: ABVPD3608H) (APPELLANT) (RESPONDENT) ITA NO. 198 TO 202/A/2014 A.Y. 2005-06 TO 2009-10 (SMT) RIDHIMA DIDWANIA VS. ASSTT. COMMISSIONER O F INCOME TAX HOUSE NO.44 A LANE NO.5 CENTRAL CIRCLE RAVINDRAPURI VARANASI VARANASI (PAN: AIYPD6957D) (APPELLANT) (RESPONDENT) ITA NO. 216 TO 220/A/2014 A.Y. 2005-06 TO 2009-10 3 ITA NO. 222 TO 227/A/2014 A.Y. 2004-05 TO 2009-10 ANUJ KUMAR DIDWANIA (HUF) VS. ASSTT. COMMISS IONER OF INCOME TAX HOUSE NO.44-A LAN NO.5 CENTRAL CIRCLE RAVINDRAPURI VARANASI VARANASI (PAN: AABHA6699C) (APPELLANT) (RESPONDENT) ITA NO. 228/A/2014 A.Y. 2010-11 ANUJ KUMAR DIDWANIA VS. ASSTT. COMMISSIONER OF INCOME TAX HOUSE NO.44-A LANE NO.5 CENTRAL CIRCLE RAVINDRAPURI VARANASI VARANASI (PAN: ABVPD3611N) (APPELLANT) (RESPONDENT) ITA NO. 237/A/2014 A.Y. 2010-11 M/S. DIDWANIA CONSTRUCTION VS. ASSTT. COMMISSI ONER OF INCOME TAX B-27/90 GROUND FLOOR CENTRAL CIRCLE SHAKUMBHARI COMPLEX VARANASI VARANASI (PAN: AADFD0793N) (APPELLANT) (RESPONDENT) ITA NO. 151/A/2014 A.Y. 2009-10 SHUBH REALTORS VS. ASSTT. COMMISSIONER OF IN COME TAX B-27/90 GROUND FLOOR CENTRAL CIRCLE SHAKUMBHARI COMPLEX VARANASI DURGAKUND ROAD VARANASI ( PAN: ABKFS0184Q) (APPELLANT) (RESPONDENT) ITA NO. 216 TO 220/A/2014 A.Y. 2005-06 TO 2009-10 4 ITA NO. 188 & 189/A/2014 A.Y. 2005-06 & 2006-07 M/S. BANSHIDHAR HARDWARE PRIVATE LTD VS. ASSTT. CO MMISSIONER OF INCOME TAX 36-A RAVINDRAPURI CENTRAL CIRCLE VARANASI VARANASI (PAN: AACCB5982D) (APPELLANT) (RESPONDENT) ITA NO. 193 & 194/A/2014 A.Y. 2005-06 & 2006-07 M/S. MANGALAM REPOSITORY PRIVATE LTD VS. ASSTT. CO MMISSIONER OF INCOME TAX 36-A RAVINDRAPURI CENTRAL CIRCLE VARANASI VARANASI (PAN: AAECM8535H) (APPELLANT) (RESPONDENT) ITA NO. 154/A/2014 A.Y. 2010-11 SUVIDHA HI-TECH DIAGNOSTIC PVT. LTD VS. ASSTT. COMMISSIONER OF INCOME TAX B-27/90 GROUND FLOOR CENTRAL CIRCLE SHAKUMBHARI COMPLEX VARANASI BHELUPURA VARANASI ( PAN: AAFCS9476A) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI ASHISH BANSAL & SHIR SAURABH AGARWAL REVENUE BY : SHRI UMESH PATHAK DATE OF HEARING : 29.04.2015 DATE OF PRONOUNCEMENT : 30.04.2015 ITA NO. 216 TO 220/A/2014 A.Y. 2005-06 TO 2009-10 5 O R D E R PER BENCH: THERE ARE 41 APPEALS UNDER CONSIDERATION FOR THE D IFFERENT ASSESSMENT YEARS AND THE APPEALS ARE FILED BY 15 DIFFERENT ASSESSES. THE APPEALS UNDER CONSIDERATION RELATE TO LEVY OF PENALTY U/S 271(1)(B) OF THE ACT FOR NON COMPLIANCE WITH NOTICES ISSUED U/S 142(1) OF THE ACT CALLING FOR FURNISHING OF DOCUMENTS REQUIRED FOR THE ASSESSMENTS. 2. BRIEFLY STATED RELEVANT FACTS EMANATING ON THE O RDERS OF THE REVENUE INCLUDE THAT THE AO ISSUED U/S 142(1) NOTICES CALLING FOR T HE DOCUMENTS ON 14.07.2011 AND 11.11.2011 AS THE CASE MAY BE. DUE DATE OF FURNISHI NG THE DOCUMENTS IS 03.08.2011 04.08.2011 05.08.2011 AND 18.11.2011 AS THE CASE MAY BE. IN REPLY ASSESSEE INFORMED THE AO ABOUT FILING OF OBJECTIONS AGAINST THE AOS BLOCK ASSESSMENT PROCEEDINGS ON THE GROUNDS OF INVALIDITY OF THE NOTICES ISSUED FOR ASSUMING JURISDICTION. ASSESSEE OF THE OF THE VIEW THAT PROCEEDINGS U/S 271(1)(B) OF THE ACT DO NOT SURVIVE IF THE ASSESSMENT PROCEEDING S ARE DROPPED. HOWEVER AO COMPLETED THE ASSESSMENTS IN ALL THESE CASES U/S 15 3A/C R.W.S. 143 OF THE ACT. THE BEST JUDGMENT WAS DONE IN VIEW OF THE REJECTION OF BOOKS OF ACCOUNTS. 3. BEFORE US LEARNED COUNSEL FOR THE ASSESSES DETA ILED THE ABOVE SAID FACTS OF THE CASES AND MENTIONED THAT THE IMPUGNED PENALTY P ROCEEDINGS ARE NOT SUSTAINABLE IN LAW WHEN THE ASSESSEE COMPLIED WITH THE REQUIRE MENTS OF THE AO IN THE ASSESSMENT PROCEEDINGS AND THE ASSESSMENTS WERE DUL Y COMPLETED U/S 143(3) R.W.S. 153A/153C/144 OF THE ACT. IN THIS REGARD LEARNED C OUNSEL RELIED ON THE DECISION OF CO-ORDINATE BENCH IN THE CASE OF NOOR COTTAGE PVT. LTD. VS. ITO ITA NO. 87/A/2014 DATED 20.06.2014. 4. FURTHER LEARNED COUNSEL RELIED ON THE DECISION OF DELHI TRIBUNAL ORDER DATED 10.08.2007 IN THE CASE OF AKHIL BHARTIYA PRATHMIK SHIKSHAK SANGH BHAWAN TRUST VS. ASSISTANT DIRECTOR OF INCOME REPORTED IN (2008) 115 TTJ 0419 (DEL). FOR READY REFERENCE HE REPRODUCE FROM THE SAID ORDER AS UNDE R: PENALTY UNDER S. 271(1)(B)-VALIDITY ASSESSMENT MAD E UNDER S. 143(3)- ASSESSMENT HAVING BEEN MADE U/S 143(3) AND NOT UNDE R S. 144 IT MEANS ITA NO. 216 TO 220/A/2014 A.Y. 2005-06 TO 2009-10 6 THAT SUBSEQUENT COMPLIANCE IN THE ASSESSMENT PROCEE DINGS WAS CONSIDERED AS GOOD COMPLIANCE AND THE DEFAULTS COMMITTED EARLI ER WERE IGNORED BY THE AO HENCE PENALTY U/S 271(1)(B) COULD NOT BE LEVIED . CONCLUSION: ASSESSMENT HAVING BEEN MADE U/S 143(3) AND NOT UNDE R S. 144 IT MEANS THAT SUBSEQUENT COMPLIANCE IN THE ASSESSMENT PROCEE DINGS WAS CONSIDERED AS GOOD COMPLIANCE AND THE DEFAULTS COMMITTED EARLI ER WERE IGNORED BY THE AO HENCE PENALTY U/S 271(1)(B) COULD NOT BE LEVIED .. ..2.5 WE ALSO FIND THAT FINALLY THE ORDER WAS PASSE D U/S 143(3) AND NOT U/S 144 OF THE ACT. THIS MEANS THAT SUBSEQUENT COMPLIAN CE IN THE ASSESSMENT PROCEEDINGS WAS CONSIDERED AS GOOD COMPLIANCE AND T HE DEFAULTS COMMITTED EARLIER WERE IGNORED BY THE AO. THEREFORE IN SUCH CIRCUMSTANCES THERE COULD HAVE BEEN NO REASON TO COME TO THE CONCLUSION THAT THE DEFAULT WAS WILLFUL. 2.6 IN VIEW OF THE AFORESAID DISCUSSION IT IS HELD THAT THE LD. CIT(A) WAS NOT RIGHT IN UPHOLDING THE LEVY OF PENALTY. THUS THE A PPEAL IS ALLOWED. 5. FURTHER HE RELIED ON THE DECISION IN THE CASE O F PAIGAM IMPEX PVT. LTD. VS. ACIT ITA NO. 4787 TO 4791/DEL/2013 DATED 06.02.2014 . IN THIS REGARD HE REPRODUCED PARA 5 AND 5.1 FROM THE SAID ORDER AS UN DER:- 5. HAVING HEARD THE LD. SR. DR AND PERUSED THE MAT ERIAL AVAILABLE ON RECORD IN THE ABOVE MENTIONED FACTUAL MATRIX WE ARE OF TH E VIEW THAT IN THE FACTS OF THE PRESENT CASE THERE IS NOTHING ON RECORD TO SHOW THAT PENAL ACTION WAS WARRANTED AS IN ALL THESE YEARS ON THE SPECIFIC DA TE VERY LITTLE TIME WAS GIVEN BY THE AO TO THE ASSESSEE TO OFFER EXPLANATION. MOR EOVER THE RETURNED INCOME WAS ACCEPTED VIDE ORDER U/S 153A R.W.S. 143( 3) FOR EACH OF THE YEARS EVIDENT FROM THE COPIES FILED. IN THESE FACTS IT CA N BE SAFELY CONCLUDED THAT THE SUBSEQUENT COMPLIANCE IN ASSESSMENT PROCEEDINGS WAS CONSIDERED AS GOOD COMPLIANCE AND THE DEFAULTS COMMITTED EARLIER WERE IGNORED BY THE AO WHICH ARE THE PRINCIPLES LAID DOWN BY THE DECISION BY THE CO-ORDINATE BENCH IN THE CASE OF AKHIL BHARTIYA SHIKSHAK SANGH BHAWAN TRUST VS. ACIT (2008) 115 TTJ (DELHI) 419 RELIED UPON THE ASSESSEE IN ITS GROUND NO. 4 AND WHICH HAS BEEN FOLLOWED IN VARIOUS ORDERS BY CO-ORDINATE BENCHES. REFERENCE MAY BE MADE TO ORDER DATED 31.01.2014 IN THE CASE OF M/ S. MANJUSHA MADAN VS. DCIT IN ITA NO. 4698 TO 4703/DEL/2013. FOR READY RE FERENCE WE REPRODUCE FROM THE SAID ORDER AS UNDER:- 7. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS A ND PERUSED THE RECORDS. WE FIND CONSIDERABLE COGENCY IN THE LD. COUNSEL OF THE ASSESSEES SUBMISSION THAT THE SHOW CAUSE NOTICE DOES NOT MENTIONED ABOUT THE NON-COMPLIANCE OF NOTICE ON WHICH PENALTY HAS BEEN LEVIED. HENCE ASSUMPTION OF JURISDICTION IS NOT PROPER. WE FURTHER FIND THAT IN THESE CASES THE AO HAS ASKE D EXPLANATION OF QUESTIONS AND ASSESSEE WAS GIVEN ONLY 7 DAYS TIME. IN THESE CIRCU MSTANCES IN OUR CONSIDERED OPINION THE ASSESSEE WAS NOT GIVEN PROPER OPPORTUN ITY AND IN THE SAME SITUATION THIS TRIBUNAL IN ITA NO. 4239/DEL/2013 IN THE CASE OF SHIVAANSH ADVERTISING AND PUBLICATIONS (P) LTD. VIDE ITS ORDER DATED 03.01.201 4 HAS DELETED THE SIMILAR PENALTY HOLDING AS UNDER:- ITA NO. 216 TO 220/A/2014 A.Y. 2005-06 TO 2009-10 7 WE HAVE HEARD BOTH THE SIDES AND PERUSED THE MATER IAL PLACED BEFORE US. THE PENALTY HAD BEEN LEVIED BY THE ASSESSING OFFICER FO R NON-COMPLIANCE OF THE NOTICE DATED 8.11.2010. FROM THE ASSESSMENT ORDER IT IS E VIDENT THAT THE NOTICE U/S 142(1)/143(2) DATED 8.11.2010 ALONGWITH THE DETAILE D QUESTIONNAIRE WAS ISSUED FIXING THE CASE FOR 18.11.2010. THESE DETAILS HAVE BEEN MENTIONED BY THE ASSESSING OFFICER IN PARAGRAPH 2 PAGES 1 OF THE ASS ESSMENT ORDER. THUS TOTAL TEN DAYS TIME WAS ALLOWED FROM THE DATE OF ISSUE OF TH E NOTICE. IN THE ASSESSMENT ORDER THE ASSESSING OFFICER HAS NOT MENTIONED THE DATE ON WHICH SUCH NOTICE WAS SERVED UPON THE ASSESSEE. THEREFORE IN OUR OPINION THE TIME OF LESS THAN TEN DAYS ALLOWED BY THE ASSESSING OFFICER FOR COMPLYING WITH THE DETAILED QUESTIONNAIRE CANNOT BE SAID TO BE A SUFFICIENT TIM E BEING ALLOWED TO THE ASSESSEE AND THEREFORE FAILURE OF THE ASSESSEE TO COMPLY W ITH SUCH NOTICE CANNOT BE SAID TO BE A DEFAULT WHICH MAY JUSTIFY THE LEVY OF PENAL TY US 271(1)(B) OF THE ACT. ACCORDINGLY THE SAME IS CANCELLED. 8. FURTHERMORE WE ALSO NOTE THAT ASSESSMENT IN THI S CASE WERE COMPLETED U/S 143(3) OF THE I.T. ACT IT DOES MEAN THE SUBSEQUENT COMPLIANCE IN THE ASSESSMENT PROCEEDINGS WAS CONSIDERED AS GOOD COMPLIANCE. THE DECISION RELIED UPON BY THE LD. COUNSEL FOR THE ASSESSEE AS ABOVE ALSO COME TO THE RESCUE OF THE ASSESSEE. 5.1 IN VIEW OF THE DETAILED REASONING ON FACTS AND LAW THE PENALTY IMPOSED IN EACH OF THE YEARS IS QUASHED. THE SAID O RDER WAS PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ITSELF. 6. FURTHER WE HAVE PERUSED ANOTHER CO-ORDINATE BEN CH DECISION IN THE CASE OF SMT. PRATIMA AGARWAL VIDE ITA NO. 163/ALLD/2014 FOR THE A.Y. 2009-10 DATED 26.06.2014 FOR IDENTICAL PROPOSITION THAT THE PENAL TY U/S 271(1)(B) IS NOT LEVIABLE WHEN THE RELEVANT ASSESSMENTS PROCEEDINGS WERE COMP LETED MEANINGFULLY UNDER PROVISION OF SECTION 143(3) OF THE ACT. ON PERUSAL OF THE SAID ORDER OF THE TRIBUNAL WE FIND THAT PARA 4 OF THE TRIBUNAL ORDER IS RELEVA NT WE EXTRACT THE SAME FOR THE PURPOSE OF COMPLETENESS OF THIS ORDER. IT IS RELEVA NT TO NOTICE THAT THE TRIBUNAL IN THIS ORDER RELIED ON THE DELHI BENCH DECISION IN TH E CASE OF AKHIL BHARTIYA SHMSHAK SANGH BHAWAN TRUST HE REPRODUCED THIS PARA 4 AS UN DER:- 4. WE HAVE HEARD RIVAL PARTIES AND HAVE GONE THROU GH THE MATERIAL PLACED ON RECORD. WE FIND THAT LD. CIT(A) HAD CONFI RMED THE PENALTY IMPOSED BY THE ASSESSING OFFICER FOR NOT MAKING COMPLIANCE OF THE NOTICE DATED 20.09.2011 U/S 142(1) OF THE ACT. LD. CIT(A) HAD N OTED THAT EVEN IN RESPONSE TO A SHOW CAUSE NOTICE U/S 271(1)(B) DATED 07.012.2011 REQUIRING THE ASSESSEE TO SHOW CAUSE ON 07.02.2012 AS TO WHY THE PENALTY U/S 271(1)(B) SHOULD NOT BE LEVIED WAS NOT REPLIED. TH IS SHOW CAUSE WAS ALSO NOT COMPLIED WITH. HOWEVER WE OBSERVE THAT THE ASS ESSMENT IN THIS CASE WAS COMPLETED U/S 143(3) AND THEREFORE IT IS IMPLIED THAT SUBSEQUENTLY THE ASSESSEE HAD ATTENDED TO THE ASSESSMENT PROCEEDINGS . THE DELHI BENCH OF THE TRIBUNAL IN THE CASE OF AKHIL BHARTIYA SHMSHAK SANGH BHAWAN TRUST VS. ADIT VIDE PARA 2.5 OF THE SAID ORDER HELD AS UNDER: - ITA NO. 216 TO 220/A/2014 A.Y. 2005-06 TO 2009-10 8 WE ALSO FIND THAT FINALLY THE ORDER WAS PASSED U/S 143(3) AND NOT U/S 144 OF THE ACT. THIS MEANS THAT SUBSEQUENT COMPLIANCE IN T HE ASSESSMENT PROCEEDINGS WAS CONSIDERED AS GOOD COMPLIANCE AND T HE DEFAULTS COMMITTED EARLIER WERE IGNORED BY THE ASSESSING OFFICER. THER EFORE IN SUCH CIRCUMSTANCES THERE COULD HAVE BEEN NO REASON TO C OME TO THE CONCLUSION THAT THE DEFAULT WAS WILLFUL. 5. WE FIND THAT THE CASE OF THE APPELLANT IS COVERE D BY THE JUDGMENT OF THE TRIBUNAL. RESPECTFULLY FOLLOWING THE SAME WE A LSO ALLOW THE APPEAL OF THE ASSESSEE. ALL THESE DECISIONS ARE RELEVANT FOR THE LEGAL PROP OSITION THAT THE PENALTIES LEVIED U/S 271(1)(B) R.W.S. 142(1) FOR NON FURNISHING OF THE D OCUMENTS ARE NOT SUSTAINABLE WHEN RELEVANT ASSESSMENTS WERE COMPLETED MEANINGFUL LY AFTER DUE PROCESS OF SCRUTINY UNDER THE PROVISION OF SECTION 153C R.W.S 143(3)/144 OF THE ACT. CONSIDERING THE SAME WE FIND THE PRESENT CASE THE ASSESSMENTS WERE COMPUTES AFTER SCRUTINY. THEREFORE WE FIND THAT THESE ARE N OT FIT CASES FOR LEVY PENALTY U/S 271(1)(B) OF THE ACT. ACCORDINGLY GROUND RAISED BY ALL THESE APPEALS ARE ALLOWED. 7. IN THE RESULT ALL THE 41 APPEALS OF THE ASSESSES ARE ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 30 TH DAY OF APRIL 2015. SD/- SD/- (C. N. PRASAD) (D. KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER ALLAHABAD DATED: 30.04.2015 *SRIVASTAVA COPY TO: THE APPELLANT THE RESPONDENT THE CIT CONCERNED ALLAHABAD THE CIT(A) CONCERNED ALLAHABAD THE DR BENCH //TRUE COPY// BY ORDER DY/ASSTT. REGISTRAR ITAT ALLAHABAD.