GOENKA PAPERS AND SYNTHETICS P. LTD, MUMBAI v. ITO WD 6(3)(1), MUMBAI

ITA 2979/MUM/2009 | 2004-2005
Pronouncement Date: 08-12-2010 | Result: Allowed

Appeal Details

RSA Number 297919914 RSA 2009
Bench Mumbai
Appeal Number ITA 2979/MUM/2009
Duration Of Justice 1 year(s) 7 month(s)
Appellant GOENKA PAPERS AND SYNTHETICS P. LTD, MUMBAI
Respondent ITO WD 6(3)(1), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 08-12-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted G
Tribunal Order Date 08-12-2010
Date Of Final Hearing 02-11-2010
Next Hearing Date 02-11-2010
Assessment Year 2004-2005
Appeal Filed On 08-05-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH G BEFORE SHRI D.K. AGARWAL JUDICIAL MEMBER AND SHRI PRAMOD KUMAR ACCOUNTANT MEMBER. ITA NO.2979/MUM/09 (ASSESSMENT YEAR : 2004-05) GOENKA PAPERS AND SYNTHETICS P. LTD. 307 POPATLAL CHAMBERS 4 TH CROSS CLIVE ROAD DANABUNDER MUMBAI 400 009 PAN NO.AAACG2141B VS. INCOME TAX OFFICER WARD 6(3)(1) MUMBAI. APPELLANT. RESPONDENT. APPELLANT BY : SHRI M. SUBAMANIAN. RESPONDENT BY : SHRI A.K. NAYAK. O R D E R PER D.K. AGARWAL : THIS APPEAL PREFERRED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DT.20.3.2009 PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) FOR THE ASSESSMENT YEAR 2004-05 SUSTAINING THE PENALTY O F RS.60 000 IMPOSED BY THE ASSESSING OFFICER UNDER SECTION 271(1)(B) OF THE INCOME TAX ACT 1961 (THE ACT.). 2. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE AS SESSEE COMPANY IS ENGAGED IN THE TRADING IN M.G. PAPER AND WASTE PAPE R FILED ITS RETURN DECLARING INCOME OF RS.21 828. DURING THE COURSE OF ASSESSMEN T PROCEEDINGS VARIOUS ITA NO.2979/MUM/09 - 2 - DETAILS WERE CALLED FOR INCLUDING PARTY-WISE DETAILS WITH NAME AND COMPLETE ADDRESSES OF CASH PURCHASES DEBITED TO THE PROFIT AN D LOSS ACCOUNT. IN RESPONSE THE ASSESSEE FURNISHED NAMES OF APPROXIMAT ELY 750 DEALERS FROM WHOM THE PURCHASES WERE MADE AND THE AMOUNT INVOLVED . HOWEVER THE ASSESSING OFFICER OBSERVED THAT THE INFORMATION SUPP LIED WAS INCOMPLETE INASMUCH AS THE ASSESSEE DID NOT GIVE COMPLETE ADDRE SSES OF CONCERNED PARTIES. IN THE ABSENCE THEREOF THE ASSESSING OFFICER OBSER VED THAT HE COULD NOT MAKE NECESSARY ENQUIRIES TO VERIFY THE TRANSACTIONS OF CAS H PURCHASES WHICH INCIDENTALLY HINGED ON THE BORDERS OF LESS THAN RS. 20 000 AND ACCORDINGLY THE ASSESSING OFFICER MADE DISALLOWANCE UNDER SECTION 40 A(3) RS.24 04 288 BEING 20% OF CASH PURCHASES OF RS.120 21 439 AND ADDED THE SAME TO THE INCOME OF THE ASSESSEE. APART FROM THIS THE ASSESSING OFFIC ER ALSO MADE DISALLOWANCE OF UNACCOUNTED INTEREST OF RS.5464 AND ACCORDINGLY COMPL ETED THE ASSESSMENT AT AN INCOME OF RS.24 31 580 VIDE ORDER DT.30.11.2006 PASSED UNDER SECTION 143(3) OF THE ACT. DURING THE COURSE OF ASSESSMENT PROCEEDI NGS THE ASSESSING OFFICER ALSO INITIATED PENALTY PROCEEDINGS UNDER SEC TION 271(1)(B) OF THE ACT FOR NON-COMPLIANCE OF THE FOLLOWING NOTICES ISSUED UNDER SECTION 142(1) OF THE ACT :- ITA NO.2979/MUM/09 - 3 - SL.NO. DATE OF LETTER/NOTICE U/S. 142(1) DATE OF SERVICE DATE OF HEARING 1. 6.9.2005 10.9.2005 22.9.2005 2. 9.8.2006 10.8.2006 21.8.2006 3. 12.9.2006 14.9.2006 20.9.2006 4. 22.9.2006 22.9.2006 29.9.2006 5. 6.10.2006 11.10.2006 16.10.2006 6. 6.11.2006 7.11.2006 16.11.2006 ACCORDINGLY A SHOW CAUSE NOTICE WAS ISSUED DT.24.8.20 06 FOR DEFAULT COMMITTED TILL THAT DATE AND ISSUE OF NOTICE DATED 6.11.2006 F OR DEFAULT COMMITTED THEREAFTER IN RESPECT OF NOTICES ISSUED UNDER SECTION 142(1)/LETTERS AS MENTIONED ABOVE. IN RESPONSE THE ASSESSEE SUBMITTED THAT IT HAD COMPLIED WITH ALL THE NOTICES AND THERE WAS NO BAD OR MALA FIDE I NTENTION BEHIND NOT ATTENDING THE HEARING OR NON-COMPLIANCE OF NOTICE AND OTHER C ORRESPONDENCE ISSUED. IT WAS THEREFORE SUBMITTED THAT THE PENALTY INITIATED BE WITHDRAWN. HOWEVER THE ASSESSING OFFICER DID NOT ACCEPT THE ASSESSEES EXPLANATION AND HE WAS OF THE VIEW THAT THE ASSESSEE HAS FAILED TO COMPLY WIT H THE NOTICES UNDER SECTION 142(1) AS MENTIONED ABOVE AND ACCORDINGLY HE IMPOSE D PENALTY OF RS.10 000 FOR EACH DEFAULT AGGREGATING TO RS.60 000 VIDE ORDER DT. 26.2.2007 PASSED UNDER SECTION 271(1)(B) OF THE ACT. ON APPEAL THE LEARNE D CIT(A) FOR THE SAME REASONS UPHELD THE PENALTY IMPOSED BY THE ASSESSING OFFICER. ITA NO.2979/MUM/09 - 4 - 3. BEING AGGRIEVED BY THE ORDER OF THE LEARNED CIT( A) THE ASSESSEE IS IN APPEAL BEFORE US CHALLENGING IN ALL THE GROUNDS THE SUSTENANCE OF PENALTY OF RS.60 000 IMPOSED BY THE ASSESSING OFFICER UNDER SEC TION 271(1)(B) OF THE ACT. 4. AT THE TIME OF HEARING THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITS THAT THE ASSESSEE HAS ATTENDED ON ALL THE DATES OF HEARING OF THE NOTICES AND HAS ALSO ATTENDED ON THE DATE OF HEARING AS AND WHE N FIXED BY THE ASSESSING OFFICER EXCEPT THE DATE OF SECOND NOTICE ISSUED UNDER SECTION 142(1) ON WHICH DATE MRS. ANJALI MASALIA WAS GOING TO ATTEND THE SA ME BUT DURING THE SAME TIME DUE TO MEDICAL ADVISE SHE HAD TO GO ON A MATERNITY L EAVE AND SHE WAS HOSPITALISED FOR SEVERAL DAYS. SHE WAS NOT IN SUCH A CONDITION THAT IT WAS NOT POSSIBLE TO INFORM THE SAME. HE FURTHER SUBMITS THA T SINCE THE ASSESSEE WAS NOT HAVING COMPLETE ADDRESSES OF THE CONCERN PARTIE S HE COULD NOT FILE THE SAME TO THE ASSESSING OFFICER AND FOR THAT DEFAULT T HE ASSESSING OFFICER HAS ALREADY MADE DISALLOWANCE OF RS.24 04 288 BEING 20% OF CASH PURCHASES OF RS.120 21 439 UNDER SECTION 40A(3) OF THE ACT THERE FORE THE PENALTY IMPOSED BY THE ASSESSING OFFICER AND SUSTAINED BY THE LD. CI T(A) BE DELETED. 5. ON THE OTHER HAND THE LEARNED D.R. SUPPORTS THE ORDER BY THE ASSESSING OFFICER AND LEARNED CIT(A). ITA NO.2979/MUM/09 - 5 - 6. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF TH E RIVAL PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND T HAT BEFORE THE LEARNED CIT(A) VIDE WRITTEN SUBMISSION DATED 24.2.2008 IT H AS BEEN STATED BY THE ASSESSEE THAT HE HAS MADE COMPLIANCE OF ALL NOTICES ISSUED UNDER SECTION 142(1) EXCEPT SECOND NOTICE ISSUED UNDER SECTION 142(1) ON W HICH DATE MRS. ANJALI MASALIA C.A. WHO WAS HANDLING THE CASE PROCEEDED O N MATERNITY LEAVE AND HOSPITALIZED FOR SEVERAL DAYS. THIS STATEMENT OF F ACTS WAS NOT CONTROVERTED BY THE LEARNED D.R. EVEN AT THIS STAGE. WE FURTHER FI ND THAT FOR NOT GIVING COMPLETE ADDRESSES OF THE PARTIES THE ASSESSING OF FICER HAS ALREADY MADE DISALLOWANCE OF ` .24 04 288 UNDER SECTION 40A(3) OF THE ACT. IT IS S ETTLED LAW THAT THE LAW DOES NOT CONTEMPLATE OR REQUIRE THE PERF ORMANCE OF AN IMPOSSIBLE ACT LEX NON COGIT AD IMPOSSIBILITY VIDE LIC OF IN DIA VS. CIT (1996) 219 ITR 410 (SC). THIS BEING SO AND KEEPING IN VIEW THAT IN PARA 3 OF THE ASSESSMENT ORDER THE ASSESSING OFFICER HAS MENTIONED IN RESPONSE T O THE NOTICES SHRI PRADEEP BANKA CA DULY AUTHOIRSED BY THE ASSESSEE COMPANY ATT ENDED FROM TIME TO TIME AND SUBMITTED DETAILS CALLED FOR AND THE CASE WAS DI SCUSSED WITH HIM WE ARE OF THE VIEW THAT THERE WAS NO DEFAULT AS PART OF THE ASSESSEE AND IN ANY CASE THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE THERE FORE THE PENALTY IMPOSED BY THE ASSESSING OFFICER AND SUSTAINED BY THE LD. CI T(A) IS NOT SUSTAINABLE IN ITA NO.2979/MUM/09 - 6 - LAW AND ACCORDINGLY THE SAME IS DELETED. THE GROUND S TAKEN BY THE ASSESSEE ARE THEREFORE ALLOWED. 7. IN THE RESULT THE ASSESSEES APPEAL STANDS ALLOWE D. ORDER PRONOUNCED IN THE OPEN COURT ON 8.12.2010. SD/- SD/- (PRAMOD KUMAR) (D .K. AGARWAL) ACCOUNTANT MEMBER JUDICIA L MEMBER MUMBAI DT.8-12-2010. * GPR COPY TO : 1. THE ASSESSEE. 2. THE ASSESSING OFFICER. 3. CIT(APPEALS) 4. CIT 5. DEPARTMENTAL REPRESENTATIVE ITAT MUMBAI. BY ORDER DY./ASST.REGISTRAR ITAT MUMBAI ITA NO.2979/MUM/09 - 7 - S.NO. DESCRIPTION DATE INTLS 1. DRAFT DICTATED ON 2.11.2010 SR.P.S./P.S 2. DRAFT PLACED BEFORE AUTHOR SR.P.S/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5 APPROVED DRAFT COMES TO THE SR.P.S./PS SR.P.S./P.S 6. KEPT FOR PRONOUNCEMENT ON 8-12- 2010` SR. P.S./P.S. 7. FILE SENT TO THE BENCH CLERK SR.P.S./P.S 8 DATE ON WHICH FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER