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Income Tax Appellate Tribunal, JAIPUR BENCHES “A”, JAIPUR
Before: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM vk;dj vihy la-@ITA No. 1041/JP/2018
fu/kZkfjrh dh vksj ls@ Assessee by : Shri Ajay Mathur (Assessee) jktLo dh vksj ls@ Revenue by : Shri Varinder Mehta (CIT-DR) lquokbZ dh rkjh[k@ Date of Hearing : 15/01/2019 mn?kks"k.kk dh rkjh[k@ Date of Pronouncement : 16/01/2019 vkns'k@ ORDER PER: VIJAY PAL RAO, J.M.
This appeal by the assessee is directed against the order dated 12/06/2018 of ld. CIT (A)-2, Jaipur for the A.Y. 2008-09. The assessee has raised following grounds of appeal: “1. The learned C.I.T. (A) -2, Jaipur grossly erred in law and on facts in upholding penalty u/s 271(1)(c) in respect of salary of Rs. 5,77,716 shown as per Salary Certificate issued by the employer.
2. (i) The learned C.I.T. (A) -2, Jaipur has erred in not taking into consideration Salary Certificate dated 30/03/2008 issued by ICICI Bank as per which total income is of Rs. 3,56,080, the tax payable is ITA 1041/JP/2018_ 2 Ajay Mathur Vs ITO of RS. 57,498 and TDS u/s 192 made by the employer is of Rs. 57,498.
(ii) The learned C.I.T. (A) -2, Jaipur erred in not taking into consideration C.I.T. (A)’s order dated 23/05/2018 for A.Y. 2008 - 09 as per which duplication of salary income has been deleted and the gross salary income of Rs. 5,77,716 has been confirmed.
3. The learned C.I.T. (A) -2, Jaipur erred in ignoring the fact that there was no outstanding tax liability payable by the appellant because employer on total income of Rs. 3,56,080 had made TDS u/s 192 of Rs. 57,498 and as per the Salary Certificate, tax payable is NIL.
4. The learned C.I.T. (A) -2, Jaipur erred in confirming the penalty on the ground that return of income had neither been filed u/s 139(1) nor u/s 148 even though there was no outstanding tax liability and no tax had been evaded.
5. The learned C.I.T. (A) -2, Jaipur erred in confirming the penalty even though no addition had been made to the total income of the appellant shown as per the Salary Certificate issued by the employer.
6. The learned C.I.T. (A) -2, Jaipur erred in confirming the penalty even though no clear finding whether the assessee is guilty of concealing the income or furnishing inaccurate particulars of income was stated in the show cause notice dt.09/03/2016.
[CIT vs. Whiteford India Ltd. 38 taxmann.com 15 (Gujarat)].
Your appellant prays for the leave to add to alter and /or to amend all or any of the grounds before the final hearing of the appeal.”
2. The assessee is individual and derives income from salary. Since the assessee did not file return of income for the year under consideration therefore, the Assessing Officer issued notice U/s 148 of the Income Tax Act, 1961 (in short the Act) and passed the assessment order U/s 144 of ITA 1041/JP/2018_ 3 Ajay Mathur Vs ITO the Act on 09/3/2018 whereby the Assessing Officer has assessed the total income of the assessee at Rs. 10,26,099/- which is as per the details given in 26AS. The Assessing Officer has given the finding that the assessee has received payment from ICICI bank on which a TDS of Rs. 1,01,482/- was deducted by the payer U/s 192B of the Act and 192A. On appeal against the assessment order, the ld. CIT(A) found that there was a mistake in the 26AS whereby the salary of the assessee was Rs. 5,77,716/- and not Rs. 10,26,099/- as considered by the Assessing Officer. The ld. CIT(A) after taking correct amount of salary, deleted the balance amount. The Assessing Officer in the mean time initiated a penalty proceeding U/s 271(1)(c) of the Act and levied the penalty against the entire addition of Rs. 10,26,099/-. On further appeal by the assessee against the levy of penalty U/s 271(1)(c) of the Act, the ld. CIT(A) has restricted the amount only to the extent of salary income of Rs. 5,77,716/-.
3. Before us, the assessee has appeared in person and submitted that the total income of the assessee is comprising of salary income only which is subjected to TDS U/s 192 of the Act and therefore, there was no tax liability after the order of the ld. CIT(A) passed in the quantum appeal.
The assessee has referred to the order dated 23/5/2018 passed by the ld.
ITA 1041/JP/2018_ 4 Ajay Mathur Vs ITO CIT(A) whereby the addition was deleted by considering the correct amount of salary income of Rs. 5,77,716/- received from ICICI bank. The Assessing Officer also accepted the same in the remand report that incorrect amount was shown in the 26AS. Thus, the ld AR has submitted that when there was no tax liability arising from the assessment order then there shall not be any penalty U/s 271(1)(c) of the Act. The assessee has also objected to the validity of the notice issued U/s 274 of the Act and consequential order passed U/s 271(1)(c) of the Act when the Assessing Officer has not specified the ground on which the penalty was proposed to be levied.
4. On the other hand, the ld. CIT-DR has submitted that since the assessee has not filed any return of income, therefore, it is case of concealment of income as not disclosed by the assessee in the return of income. He has relied upon the orders of the authorities below.
We have considered the rival submissions as well as the relevant material on record. At the outset we note that the income assessed to tax by the Assessing Officer in pursuant to the order of the ld. CIT(A) dated 23/5/2018 in quantum appeal is nothing but the salary income of the assessee, which was subjected to TDS U/s 192 of the Act. The relevant part of the order of the ld. CIT(A) in quantum appeal is as under:
ITA 1041/JP/2018_ 5 Ajay Mathur Vs ITO
“3.3 I have perused the facts of the case, the assessment order and :-e submissions of the appellant, Based on information available with the Assessing Officer regarding receipts of Rs. 10,26,099/- by the appellant and since no return was filed, notice under section 148 was issued. The notices could not be served on the address available and the same were returned back by the postal department. Finally, information was sought by informing the appellant on e-mail address appearing in the AST as per return filed for A.Y. 2014-15, but there was no compliance and assessment was completed under section 144 read with 147 on a total income of Rs. 10,26,100/-.
In the present proceedings, it was submitted that the appellant was an individual serving in ICICI Bank and in the form 26AS some entries were entered twice and amount of Rs. 10,26,100/- was reflected whereas as per Form 16 and certificate issued by ICICI Bank, total salary was Rs. 5 77 716/-.
Considering the entire facts, the details were forwarded to the Assessing Officer and a remand report called for. In the remand report dated 05/04/2018, the Assessing Officer has mentioned as follows:
"Kindly refer your office letter No. 3036 dated 18.01.2018 on the subject cited above.
In this regard, it is submitted that in this case assessment under section 144 of the IT Act was made after affording reasonable opportunities to the assessee as detailed below. S. No. Letter date Section under which notice issued 1. Dated 28/03/2015 U/s 148 2. Dated 07/07/2015 142(1) 3. 11/01/2016 Letters/148 were sent at the new address/e-mail 4. 25/02/2016 142(1)
It is further submitted that all the above notices were sent through Speed Post at the addresses/e-mail available on record. Thus, the assessee's contention that no opportunity was given, is incorrect. Further due to non-compliance on the part of the assessee, assessment was made on basis of details available in 26AS as per
ITA 1041/JP/2018_ 6 Ajay Mathur Vs ITO which the assessee has received payment of Rs. 10,26,099/- from ICICL Bank Ltd. on which TDS of Rs. 1,01,482/- was deducted.
Now, the assessee has filed form 16, copy of certificate issued by the employer certifying gross salary income and TDS deducted thereon and copy of bank statement of the account held with ICICL Bank in your office. It is seen that double entries of same amounts credited in assessee's account on same date, are appearing in 26AS details of ITS data due to which the total amount credited got increased than the actual receipts of me assessee. Further, it is apparent from the Form 16 and the certificate issued by the employer Bank of the assessee certifying therein the gross salary income received and TDS deducted thereon that actual receipts of the assessee during the year was of Rs. 5,77,716/- and TDS deducted thereon was of Rs. 57,498/-. In view of the above, the salary income of Rs. 5,77,716/- may be accepted as his total income. Submitted please.” In view of the factual position as reported by the Assessing Officer, the salary income of Rs. 5,77,716/- is taken as the income of the appellant and balance addition is deleted. Ground of appeal is partly allowed.
Thus, it is clear that the Assessing Officer in the remand report itself found the factual position that the salary income of the assessee during the year is Rs. 5,77,716/- which was subjected to TDS U/s 192 of the Act.
The said salary income was received from ICICI bank. Once the entire income of the assessee is only from salary and advance tax was paid on the same and no further demand is arising even the Assessing Officer has passed the impugned assessment order under consideration ex parte U/s 147 of the Act. Therefore, having regard to the facts and circumstances of the case, the assessee’s entire income was subjected to TDS at the average rate U/s 192 of the Act and no further tax liability has arisen due to the assessment framed by the Assessing Officer then it may be a case of default made by the assessee for not filing the return of income but it
ITA 1041/JP/2018_ 7 Ajay Mathur Vs ITO cannot be a case of concealment of income as there is no subsequent demand over and above the advance tax paid by the assessee. Merely because the assessee has not filed the return of income when there is no demand of tax by virtue of the assessment order would not ipso facto attract the penalty U/s 271(1)(c) of the Act. The penalty has to be levied equivalent to the sum which shall not be less than but shall not exceed three times the amount of tax sought to be evaded by reason of concealment of particulars of income or furnishing inaccurate particulars of income. Though the assessee has not filed any return of income, however, that has not resulted any tax sought to be evaded because of the reason that the entire due tax was already paid in advance as the TDS was deducted U/s 192 of the Act. This fact is not in dispute, therefore, the assessee being a salaried person and already paid the entire tax in advance, cannot be penalized U/s 271(1)(c) of the Act for not filing the return of income when there is no tax liability arising even by passing the assessment order by the Assessing Officer. The assessee may be liable for the penalty for not filing of return of income but cannot be penalized U/s 271(1)(c) of the Act. Accordingly, in facts and circumstances, it is not a case of tax sought to be evaded by the assessee than merely because the assessee has not filed the return of income will not attract the penalty provisions U/s 271(1)(c) of the Act. The mandatory
ITA 1041/JP/2018_ 8 Ajay Mathur Vs ITO condition for levy of penalty is furnishing of inaccurate particulars of income or concealment of income resulting due tax sought to be evaded. Therefore, in absence of any tax sought to be evaded merely because not filing the return of income will not attract the penalty proceedings. Hence, the penalty levied U/s 271(1)(c) is deleted.
In the result, appeal of the assessee is allowed. Order pronounced in the open court on 16th January, 2019.
Sd/- Sd/- ¼foØe flag ;kno½ ¼fot; iky jko½ (VIKRAM SINGH YADAV) (VIJAY PAL RAO) ys[kk lnL;@Accountant Member U;kf;d lnL;@Judicial Member Tk;iqj@Jaipur fnukad@Dated:- 16th January, 2019. *Ranjan आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू vihykFkhZ@The Appellant- Shri Ajay Mathur, Ahmedabad. 1. izR;FkhZ@ The Respondent- The ITO Ward-6(2), Jaipur. 2. vk;dj vk;qDr@ CIT 3. vk;dj vk;qDr¼vihy½@The CIT(A) 4. विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 5. xkMZ QkbZy@ Guard File (ITA No. 1041/JP/2018) 6. vkns'kkuqlkj@ By order,
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