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Income Tax Appellate Tribunal, “DB” BENCH, JODHPUR
Before: SHRI PAVAN KUMAR GADALE & SHRI DR. DIPAK P. RIPOTE.
O R D E R PER BENCH: The six appeals are filed by the assessee against the separate orders of the Commissioner of Income Tax (Appeals)(CIT(A)Udaipur-2 passed u/s 271(1)(b) and U/sec250 of the Act. to 49/Jodh/2023. Chutra Ram Choudhary. Jodhpur - 2 - Since the issues involved in these appeals are common and identical, hence are clubbed, heard and consolidated order is passed. For the sake of convenience, we shall take up the A.Y. 2011-12 as a lead case and the facts narrated. The assessee has raised the following grounds of appeal:
1. That on the facts and in the circumstances of the case, the ld CIT(A) grossly erred in upholding the validity of order of imposition of penalty by ld AO.
2 On the facts and in the circumstances of the case, the ld CIT(A) grossly erred in sustaining the penalty of Rs 10,000/- u/s 271(1)(b) of the Act,
3. That on the facts and in the circumstances of the case, the ld CIT(A) grossly erred in not considering the submission in right perspective and judicious manner while confirming the penalty u/s 271(1)(b) of the Act.
4. That the petitioner may kindly be permitted to raise any additional or alternative grounds at or before the time of hearing.
The brief facts of the case that the assessee has not filed the return of income and there was search u/s 132A of the Act and after recording the satisfaction u/s 153C of the Act the assessee was issued notice u/s 153C of the Act. Subsequently the Assessing Officer(AO) has issued notice 142(1) of the Act on 15.10.2018 and was complied. In to 49/Jodh/2023. Chutra Ram Choudhary. Jodhpur - 3 - response to notice u/s 153C of the Act dated 28.09.2018, the assessee has filed the return of income for the A.Y 2011- 12 on 05.11.2018 disclosing a total income of Rs. 1,48,700/- In the course of assesseement proceedings, the assessee was called to furnish the capital account and statement of affairs for the F.Y 2010-11. Since the assessee has not maintained the books of accounts and has declared income under presumptive basis u/s 44AD of the Act no details in respect of books of accounts were filed. Subsequently the A.O has issued notice u/s 142(1)(iii) of the Act dated 04.12.2018 to furnish the details of assets and liabilities and there was no compliance and finally the assessment was completed u/s 143(3) r.w.s 153C of the Act dated 09.12.2018.
3. Subsequently, the AO has initiated penalty proceedings u/s 271(1)(b) of the Act and found that the assessee has not disclosed the reasonable cause for non compliance to the notice u/s 142(1) of the Act and the A.O was not satisfied with the explanations filed in the proceedings and levied a penalty of Rs. 10,000/- and passed the order u/s 271(1)(b) of the Act dated 25.06.2019. 4. Aggrieved by the penalty order, the assessee has filed an appeal before the CIT(A). Whereas the CIT(A) has confirmed the action of the AO and sustained the penalty and ITA No. 44 to 49/Jodh/2023. Chutra Ram Choudhary. Jodhpur - 4 - dismissed the assessee appeal. Aggrieved by the CIT(A) order, the assessee has filed an appeal before the Hon’ble Tribunal. 5. At the time of hearing, the Ld. AR of the assessee submitted that the assessee has cooperated in submitting the information before the AO and mentioned that the assessee has adopted income under presumptive basis u/s 44AD of the Act and therefore no books of accounts were maintained and there is no wanton act of the assessee for non compliance and the assessement order was passed U/sec143(3) r.w.s 153A of the Act. The Ld.AR substantiated the submissions with the judicial decisions and prayed for allowing the appeal.Contra, the Ld. DR supported the order of the CIT(A). 6. We heard the rival submissions and perused the material on record. Prima-facie the AO has levied the penalty u/s 271(1)(b) of the Act as the assessee has not complied with the notices. Whereas on perusal of the facts and the submissions of the Ld. AR, the assessee was first issued notice u/s 142(1) of the Act along with the questionnaire on 15.10.2018 and the assessee has submitted the information and stated that the assessee has opted presumptive basis income u/s 44AD of the Act ITA No. 44 to 49/Jodh/2023. Chutra Ram Choudhary. Jodhpur - 5 - therefore statement of accounts and books of accounts are not maintained. Further the assessee was issued another notice u/s 142(1)(iii) of the Act dated 04.12.2018 to furnish the statement of assets and liabilities for the A.Y 2011-12, and the assessment order was passed u/s 143(3)r.w.s 153C fo the Act dated 19.12.2018 which cannot be disputed. The Ld AR substantiated the submissions relying on the judicial decisions as under: 1.Decision of Hon'ble ITAT, Surat Bench in the case of Ramabhai Kanjibhai Patel v/s DCIT, Surat in to 110/SRT/2023 dt. 11/05/2023.
2. Decision of Hon'ble ITAT, Mumbai Bench in the case of M/s Salasar Derivatives Pvt. Ltd v/s ITO, Mumbai in 10 1916/MUM/2021 dt. 14/06/2021.
Decision of Hon'ble ITAT, Delhi Bench in the case of Shiv Kumar Nayyar v/s ACIT, Delhi in & 6204/DEL/2019 dt. 11 27 31/03/2021.
Decision of Hon'ble ITAT, Delhi Bench in the case of Jai Gopal Sondhi & Ors. V/S ITO, Delhi in dt. 28/10/2020.
Decision of Hon'ble ITAT, Kolkata Bench in the case of Prachi Enterprices Pvt. Ltd. v/s ITO, Kolkata in dt. 20/03/2020.
We found that the submissions made by the Ld. AR are realistic and when the assessment was completed u/s 143(3)
ITA No. 44 to 49/Jodh/2023. Chutra Ram Choudhary. Jodhpur - 6 - r.w.s 153C of the Act, the penalty u/s 271(1)(b) of the Act cannot be imposed. Considering the facts, circumstances and the ratio of judicial decisions, we set-aside the order of the CIT(A) and direct the Assessing officer to delete the penalty and allow the grounds in favour of the assessee. 8. In the result, the appeal filed by the assessee is allowed. 46, 47, 48 & 49/Jodh/2023, A.Y 2012-13, 2013-14, 2014-15, 2015-16 & 2017-18.
As the facts and circumstances in these appeals are identical to A.Y 2011-12 (except variance in figures) and the decision rendered in above paragraphs would apply mutatis mutandis for this appeal also. Accordingly, grounds of appeal
of the assessee are allowed.
10. In the result, the six appeals filed by the assessee are allowed. Order pronounced in the open court on 17.08.2023.