HEENA N KANAKIA, MUMBAI v. ACIT CC 32, MUMBAI

ITA 5206/MUM/2013 | 2004-2005
Pronouncement Date: 21-11-2014 | Result: Allowed

Appeal Details

RSA Number 520619914 RSA 2013
Assessee PAN ANTPK4556B
Bench Mumbai
Appeal Number ITA 5206/MUM/2013
Duration Of Justice 1 year(s) 3 month(s) 29 day(s)
Appellant HEENA N KANAKIA, MUMBAI
Respondent ACIT CC 32, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 21-11-2014
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted H
Tribunal Order Date 21-11-2014
Assessment Year 2004-2005
Appeal Filed On 22-07-2013
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNALH BENCH MUMB AI !'. $ %& % ' BEFORE SHRI JOGINDER SINGH JM AND SHRI D. KARUNAKARA RAO AM ITA NOS.5206 TO 5209/MUM/2013 ASSESSMENT YEARS-2004-05 TO 2007-08 HEENA N. KANAKIA 701/702 QUARTER DECK J.P. ROAD VERSOVA ANDEHRI(E) MUMBAI-400061 ( ( ( ( / VS. ACIT CC - 32 MUMBAI ) %& ./ PAN :ANTPK4556B ( )* / APPELLANT ) .. ( / REVENUE ) )* + % / ASSESSEE BY: SHRI VIJAY MEHTA + % / REVENUE BY : SHRI JEETENDRA KUMAR - DR ( + -'& / DATE OF HEARING 19/11/2014 ./ + -'& / DATE OF PRONOUNCEMENT : 21/11/2014 %0 / O R D E R PER JOGINDER SINGH JM: THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDERS AL L DATED 03/05/2013 OF THE LD. FIRST APPELLATE AUTHORITY MUM BAI UPHOLDING IMPOSITION OF PENALTY U/S. 271(1)(B) OF THE INCOME TAX ACT 1961 (HEREINAFTER THE ACT) SUSTAINING PENALTY OF RS.30 000/- IS FOR THE ALLEGED FAILURE OF THE ASSESSEE IN NOT RESPONDING TO VARIOUS NOTICES ISSUED BY THE ASSESSING OFFICER. 2 HEENA K. KANAKIA 2. DURING HEARING OF THESE APPEALS THE LD. COUNSEL FOR THE ASSESSEE SHRI VIJAY MEHTA ADVANCED HIS ARGUMENTS WHICH IS I DENTICAL TO THE GROUND RAISED BY FURTHER SUBMITTING THAT THERE WAS A REASONABLE CAUSE ON THE PART OF THE ASSESSEE FOR NOT RESPONDIN G TO THE NOTICES ISSUED TO THE ASSESSEE . THE LD. COUNSEL TOOK US TO VARIOUS PARAS OF THE ORDERS AND THE WRITTEN SUBMISSIONS FILED BEFORE THE AUTHORITIES. OUR ATTENTION WAS FURTHER INVITED TO THE ORDER DATE D 18/10/2012 (ITA NO.7587/MUM/2011) ORDER DATED 29/4/2013(ITA NO.150 5/M/2012) AND ALSO ANOTHER ORDER DATED 07/5/2013 (ITA NO.8357 /MUM/2011) WHEREIN ON QUANTUM ADDITION THE MATTER WAS RESTORED BACK TO THE FILE OF THE ASSESSING OFFICER AS THE LD. FIRST APPELLATE AUTHORITY REFUSED TO CONSIDER VARIOUS ADDITIONAL EVIDENCES SUBMITTED BEF ORE HIM. ON THE OTHER HAND THE LD. DR SHRI JEETENDRA KUMAR DEFEND ED THE CONCLUSION DRAWN IN THE ASSESSMENT ORDER AS WELL AS BY THE LD. FIRST APPELLATE AUTHORITY BY SUBMITTING THAT THE ASSESSEE DELIBERATELY FAILED TO RESPOND TO THE NOTICES ISSUED TO THE ASSESSEE T HEREFORE THE PENALTY WAS RIGHTLY IMPOSED/SUSTAINED. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE MATERIAL AVAILABLE ON RECORD. THE ONLY GROUND RAISE D IN THESE APPEALS PERTAINS TO LEVYING/SUSTAINING PENALTY U/S. 271(1)(B) OF THE ACT. SINCE IDENTICAL GROUND IS RAISED IN ALL T HESE APPEALS FOR THE SAKE OF CONVENIENCE THESE APPEALS ARE BEING DI SPOSED OF BY THIS COMMON AND CONSOLIDATED ORDER. 3.1 FACTS IN BRIEF ARE THAT DURING ASSESSMENT PROC EEDINGS VARIOUS NOTICES WERE ISSUED TO THE ASSESSEE. AS PER THE REVENUE THE ASSESSEE DID NOT RESPOND TO SUCH NOTICES THERE FORE THE LD. ASSESSING OFFICER IMPOSED PENALTY U/S. 271(1)(B) OF THE ACT. WE 3 HEENA K. KANAKIA NOTE THAT SEARCH AND SEIZURE ACTION WAS CARRIED OUT U/S. 132 OF THE ACT ON 24/4/2008 AND THUS THE CASE WAS CENTRAL IZED VIDE ORDER DATED 18/9/2008. SUBSEQUENTLY PROCEEDINGS U/ S.153A OF THE ACT WERE INITIATED ASKING THE ASSESSEE TO FILE RETURN WITHIN 30 DAYS OF THE RECEIPT OF NOTICE. THE ASSESSEE DID NOT FILE RETURN OF HER INCOME TILL 18/11/2010. THE ALLEGED NON-COMPLIA NCE IS SUMMARISED AS UNDER :- S.NO. NOTICES DUE DATE OF HEARING/COMP LIANCE ASSESSEES REPLY REMARKS 1. NOTICE U/S. 142(1) DT.21/09/2010 24/09/2010 NO RESPONSE 2. SHOW CAUSE LETTER DT.12.11.2010 18.11.2010 ON 18.11.2010 RETURN OF INCOME ALONGWITH BALANCE SHEET AND P&L ACCOUNT SUBMITTED FOR AY 2003-04 TO 2008- 09. ONLY PART COMPLIANCE NO BOOKS OF ACCOUNT AND SUPPORTING EVIDENTIAL DOCUMENTS SUBMITTED 3. NOTICES U/S. 143(2) 29.11.2010 ADJOURNMENT LETTER DT.26.11.2010 ON BEHALF OF ASSESSEE WITH REQUEST TO ADJOURN TILL 5.12.2010 NO DETAILS FILED 4. NOTICE U/S.142(1) DT.22.11.2010 ALONGWITH A DETAILED QUESTIONNAIRE FOR FURNISHING DETAILS REQUIRED TO COMPLETE THE ASSESSMENT PROCEEDINGS. 29.11.2010 ADJOURNMENT LETTER DATED 26.11.2010 ON BEHALF OF ASSESSEE WITH REQUEST TO ADJOURN TILL 5.12.2010 NO DETAILS FILED 5. SHOW CAUSE LETTER DT.3.12.2010 07.12.2010 NO RESPONSE 6. SHOW CAUSE LETTER DT.6.12.2010 9.12.2010 NO RESPONSE 7. SHOW CAUSE LETTER DATED 16.12.2010 21.12.2010 PART SUBMISSION VIDE LETTER DATED 21.12.2010 RECEIVED ON 22.12.2010 CONTAINING P&L BALANCE SHEET COPY OF RETURN WHICH WAS FILED EARLIER AND LOAN CONFIRMATION IN PART BANK STATEMENT IN PART WEALTH 4 HEENA K. KANAKIA TAX RETURN WITHOUT VALUATION REPORT AND WITHOUT ANNEXURE. NO RESPONSE TO THE ISSUES RAISED IN THE SHOW CAUSE. 4. AS PER THE ASSESSING OFFICER THERE IS NO COMPLIA NCE TO THE SEVEN NOTICES ISSUED TO THE ASSESSEE. THE LD. COMMI SSIONER OF INCOME TAX (APPEALS) FOUND THAT OUT OF THE 7 NOTICE S 4 WERE COMPLIED WITH AND THUS ONLY THE NOTICES MENTIONED AT S.NO.1 5 AND 6 WERE NOT COMPLIED. WE ARE EXPECTED TO EXAMINE WHETHER THE ASSESSEE COMPLIED WITH AND IF NOT WHAT WERE THE REASONS FOR NON-COMPLIANCE. IT IS WORTH MENTIONING PARA-6 (PAGE 23 OF THE PAPER BOOK) FROM THE ORDER OF THE TRIBUNAL (ITA NO.7587/M/2011) ORDER DATED 18/12/2012:- 6. WE HAVE HEARD BOTH THE PARTIES AND THEIR CONTENTIONS HAVE CAREFULLY BEEN CONSIDERED. THE ASSESSEE VIDE LETTER DATED 9/8/2010 HAD SUBMITTED TO THE AO THAT THE REQUIRED DOCUMENTS AND RECORD COULD NOT BE OBTAINED FROM THE AFOREMENTIONED PREMISES AS THE OTHER PERSON WHO HAS BROUGHT THE INJUNCTION ORDER DATED 30/6/3010 HAS RESTRAINED THE ASSESSEES PERSON TO ENTER THE PREMISES AND THEREFORE THE ADJOURNMENT WAS SOUGHT FROM THE AO AND THE RELEVANT DOCUMENTS WERE ALSO PRODUCED TO SUBSTANTIATE THE EXPLANATION. IN THE GROUND OF APPE AL BEFORE THE LD. CIT(A) IT WAS CLEARLY MENTIONED THAT THE ASSESSEE HAS NOW RECEIVED THE REQUIRED DOCUMENTS. HOWEVER THE LD. CIT(A) HAS REFUSED TO ACCEPT THE SAME ON THE GROUND THAT ASSESSEE DID NOT FULFILL THE CONDITIONS LAID DOWN IN RULE 46A. IN OU R OPINION THE ASSESSEE WAS PREVENTED BY REASONABLE AND SUFFICIENT CAUSE FOR NOT PRODUCING THE RELEVANT DOCUMENTS AND LD. CIT(A) SHOULD HAVE ADMITTED THE ADDITIONAL EVIDENCE. IN THE INTEREST OF JUSTICE WE FIND 5 HEENA K. KANAKIA THAT A REASONABLE OPPORTUNITY SHOULD BE GRANTED TO THE ASSESSEE TO PRODUCE ALL THE DOCUMENTS REQUIRED TO BE SUBMITTED TO PROVE THE GENUINENESS OF OPENING CAPITAL BALANCE AND OTHER SMALL ADDITION OF RS.1121/-. THEREFORE WE SET ASIDE THE ASSESSMENT ORDER TO THE FILE OF THE AO WITH A DIRECTION TO FRA ME DENOVO ASSESSMENT AS PER LAW AFTER GIVING THE ASSESSEE A REASONABLE AND SUFFICIENT OPPORTUNITY OF HEARING. WE DIRECT ACCORDINGLY. AS WE ARE RESTORING THIS ASSESSMENT TO THE FILE OF THE AO WE DO NOT EXPRESS ANY OPINION ON THE MERITS OF THE ADDITIONS WHICH HAVE BEEN CHALLENGED IN THE PRESENT APPEAL AS THE SAME WILL BE READJUDICATED BY AO IN PURSUANCE OF OUR AFOREMENTIONED DIRECTIONS. FOR STATISTICAL PURPOSES THE APPEAL FILED BY THE ASSESS EE IS CONSIDERED TO BE ALLOWED IN THE MANNER AFORESAID. 4.1 THE STAND OF THE ASSESSEE RIGHT FROM ASSESSMEN T STAGE IS THAT THE ASSESSEE IS UNABLE TO FURNISH DETAILS AS S UCH DETAILS WERE KEPT AT THE OFFICE SITUATED IN X-CUBE BUILDING WHICH WAS UNDER DISPUTE AND SEIZED BY CIVIL COURT DINDOSHI ( BORIVILI DVN.). THEREFORE THE ASSESSEE IS UNABLE TO PRODUCE THE DE TAILS. EVEN BEFORE THE LD. COMMISSIONER OF INCOME TAX (APPEALS) INSPITE OF VARIOUS DIFFICULTIES THE ASSESSEE FILED SUCH DETAI LS BUT THE SAME WERE DECLINED ON THE GROUND THAT THE ASSESSING OFFI CER HAD ALREADY PROVIDED SUFFICIENT OPPORTUNITY TO FILE THE SE DETAILS. WE ARE OF THE VIEW THAT ATLEAST THE LD. COMMISSIONER O F INCOME TAX (APPEALS) WAS EXPECTED TO EXAMINE THESE DETAILS ALO NGWITH CLAIMED DIFFICULTIES FACED BY THE ASSESSEE AND THEN SHOULD HAVE REACHED TO A CONCLUSION. HOWEVER THE LD. COMMISSIO NER OF INCOME TAX (APPEALS) ON THE BASIS OF OBSERVATION M ADE IN THE ASSESSMENT ORDER PROCEEDED TO DISPOSE OF THE APPEAL . THIS CLAIM OF THE ASSESSEE IS EVEN EVIDENT FROM PARA-7 (PAGE-3 ) OF THE WRITTEN 6 HEENA K. KANAKIA SUBMISSION REPRODUCED IN THE IMPUGNED ORDER. THE DI FFICULTIES OF THE ASSESSEE WERE ANALYZED AND APPRECIATED BY THE T RIBUNAL AS HAS BEEN REPRODUCED (SUPRA) IN ITS ORDER DATED 18/ 10/2012 WHEREIN THE APPEAL WAS ALLOWED FOR STATISTICAL PUR POSES DIRECTING THE ASSESSING OFFICER TO READJUDICATE AFTER PROVIDI NG DUE OPPORTUNITY TO THE ASSESSEE. 5. THE WORD REASONABLE CAUSE IN SECTION 273B MUST NECESSARILY HAVE A RELATION TO THE FAILURE ON THE P ART OF THE ASSESSEE TO COMPLY WITH THE REQUIREMENT OF LAW WHIC H HE/SHE HAD FAILED TO COMPLY WITH. IN CASE OF DELAY IN COMP LIANCE THE CAUSE SHOWN BY THE ASSESSEE FOR SUCH DELAY HAS TO B E SEEN WHETHER THERE WAS A GOOD AND SUFFICIENT CAUSE FOR SUCH NON- COMPLIANCE. IF THE CAUSE SHOWN IS SUCH AS TO EXPLAI N THE DELAY CONSTITUTE A GOOD REASON FOR NON-COMPLIANCE NO PEN ALTY WOULD BE LEVIABLE. HOWEVER IN CASES WHERE THE CAUSE SHOW N IS SUCH WHICH IS ONLY TO MITIGATE THE GRAVITY OF NON-COMPLI ANCE SUCH A CAUSE CANNOT BE EXTRAPOLATED AND TREATED AS BEING A GOOD CAUSE. A CONSTRUCTION WHICH WOULD PRESERVE THE EXERCISE OF THE POWER IN FAVOUR OF THE ASSESSEE UNDER THE CIRCUMSTANCES WHICH WARRANT IT IS TO BE PREFERRED TO A CONSTRUCTION WHI CH WOULD RESULT IN THE LIKELIHOOD OF DENIAL OF RELIEF. REASONABLE C AUSE IS NOT SUSCEPTIBLE OF A CLEAR AND PRECISE DEFINITION BUT A S APPLIED TO HUMAN ACTION WHICH WOULD CONSTRAIN A PERSON OF AVER AGE INTELLIGENCE AND ORDINARY PRUDENCE ACTING UNDER NOR MAL CIRCUMSTANCES. THE ASSESSEE BEING A LADY WHO WAS FACING THE CLAIMED DIFFICULTIES THEREFORE EVEN UNDER THE FAC TS AVAILABLE ON 7 HEENA K. KANAKIA RECORD THE ASSESSING OFFICER WAS EXPECTED NOT TO BE SO TECHNICAL IN IMPOSING THE PENALTY MORE SPECIFICALLY WHEN THE DOCUMENTS AS CALLED FOR WERE UNDER DISPUTE AND SEIZED BY THE DIRECTION OF THE COURT. THEREFORE THE ASSESSEE COULD NOT FILE T HESE DETAILS. WE APPRECIATE THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) CONSIDERING THE FACTS ATLEAST GAVE PART RELIEF TO THE ASSESSEE. IN THE PRESENT APPEALS THOUGH THERE IS A TECHNICAL BRE ACH ON THE PART OF THE ASSESSEE STILL KEEPING IN VIEW THE T OTALITY OF THE FACTS AND THE CIRCUMSTANCES BY TAKING A LENIENT VIEW TH E PENALTY IMPOSED/SUSTAINED IN EACH CASE IS DELETED. WE ARE O BSERVING HERE THAT OUR CONCLUSION IS BASED UPON PECULIAR FAC TS OF THE PRESENT APPEALS/DIFFICULTIES FACED BY THE ASSESSEE THEREFORE MAY NOT BE QUOTED AS A PRECEDENT. 6. FINALLY ALL THE APPEALS OF THE ASSESSEE ARE ALL OWED. THIS ORDER WAS PRONOUNCED ON 21 ST NOVEMBER 2014. SD/- SD/- ( D.KARUNAKARA RAO) ( JOGINDER SINGH) ACCOUNTANT MEMBER JUD ICIAL MEMBER MUMBAI; 1( DATED.- 21 /11/2014 JV SR. P.S. . 8 HEENA K. KANAKIA %0 %0 %0 %0 + ++ + 2-3 2-3 2-3 2-3 4%3/- 4%3/- 4%3/- 4%3/- / COPY OF THE ORDER FORWARDED TO : 1. )* / THE APPELLANT 2. 25)* / THE RESPONDENT. 3. 6 ( ) / THE CIT(A)- CONCERNED MUMBAI 4. 6 / CIT CONCERNED MUMBAI 5. 3 7 2-( / DR ITAT MUMBAI E BENCH 6. !8 9 / GUARD FILE. %0( %0( %0( %0( / BY ORDER 53- 2- //TRUE COPY// : :: : / (DY./ASSTT. REGISTRAR) / ITAT MUMBAI.