SHRI AMAR BHARTI,JAIPUR vs. ASSISTANT COMMISSIONER OF INCOME TAX, WARD-1-3, JAIPUR

आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR Jh fot; iky jko] U;kf;d lnL; ,oa Jh foØe flag ;kno] ys[kk lnL; ds le{k BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM vk;dj vihy la-@ITA No. 888/JP/2018 fu/kZkj.k o"kZ@Assessment Year: 2015-16 cuke Shri Amar Bharti, Assistant Commissioner of Vs. 21/691, Malviya Nagar, Income Tax, Jaipur. Ward-1(3), Jaipur. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AAPPB 4234 N vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri K.L. Moolchandani (CA) jktLo dh vksj ls@ Revenue by : Shri J.C. Kulhari (JCIT) lquokbZ dh rkjh[k@ Date of Hearing : 17/09/2018 mn?kks"k.kk dh rkjh[k@ Date of Pronouncement : 18/09/2018 vkns'k@ ORDER

PER: VIJAY PAL RAO, J.M.

This appeal by the assessee is directed against the order dated

27/06/2018 of ld. CIT(A)-I, Jaipur arising from the penalty order passed

U/s 271(1)(b) of the Income Tax Act, 1961 (in short the Act) for the A.Y.

2015-16. The assessee has raised following grounds of appeal: “1. On the facts and in the circumstances of the case, the ld. authorities below have factually and legally erred in imposing and confirming the penalty of Rs. 10,000/- U/s 271(1)(b) of the Act without appreciating the facts of the case in right perspective. Thus, the penalty so imposed is bad in law and deserves to be deleted. 2. The appellant craves to add, amend or withdraw any of the ground of appeal either before or at the time of hearing of appeal.”

ITA 888/JP/2018_ 2 Amar Bharti Vs. ACIT

21/12/2017. However, the Assessing Officer prior to completion of the

assessment has passed an order dated 07/12/2017 U/s 271(1)(b) of the

Act whereby a penalty of Rs. 10,000/- was imposed on account of failure

of the assessee to comply with the statutory notices issued U/s 142(1) of

the Act on various dates prior to the date of hearing on 28/09/2017.

Thus, the penalty in question was imposed by the Assessing Officer for

non-compliance of notices issued U/s 142(1) of the Act prior to

28/09/2017.

has levied the penalty in question without initiation of proceedings U/s

271(1)(b) of the Act or without issuing any show cause notice. He has

pointed out that the Assessing Officer has mentioned in the assessment

order only at the time of passing the order that the show cause U/s

271(1)(b) of the Act is separately issued for non-compliance of the

statutory notices and in pursuant to the said show cause notice issued on

21/12/2017, the Assessing Officer has passed an another order dated

12/08/2018 U/s 271(1)(b) of the Act. Thus, the ld AR has submitted that

when the Assessing Officer has passed a separate order after completion

of assessment and imposing penalty U/s 271(1)(b) of the Act then the

ITA 888/JP/2018_ 3 Amar Bharti Vs. ACIT

impugned order dated 07/12/2017 is illegal and without any show case

notice or initiation of penalty proceedings. He has also raised various

contentions on the point that none of the statutory notices issued by the

Assessing Officer U/s 142(1) of the Act were served on the assessee due

to the reason that that assessee had already shifted from the address

where those notices were sent by the Assessing Officer. Therefore, when

the notices were not served on the assessee, the question of non-

compliance does not arise. The ld AR has thus submitted that the

impugned order may be quashed as illegal and invalid.

Officer has levied the penalty vide impugned order for non-compliance of

the notices issued U/s 142(1) of the Act dated 21/09/2017 for the date of

hearing on 28/09/2017. Therefore, there is no bar for initiation of penalty

proceedings and imposing the penalty for non-compliance of statutory

notices even prior to the assessment order is passed by the Assessing

Officer. He has relied upon the orders of the authorities below.

material on record. The Assessing Officer passed the impugned order U/s

271(1)(b) of the Act on 07/12/2017 as under:

PENALTY ORDER UNDER SECTION 271(1)(B) OF THE I T ACT, 1961

ITA 888/JP/2018_ 4 Amar Bharti Vs. ACIT

During the Assessment proceeding, on account of assessee’s failure to comply with the statutory notice issued U/s 142(1) on various dates the hearing was fixed for 28.09.2017. On the appointed date, neither anybody attended nor any written reply was furnished. On the said date also, there was no response from the assessee’s side. This goes to show that the assessee has no explanation to offer in support of his defence. I am, therefore, satisfied that the assessee has failed to comply with the statutory notices issued without any reasonable course for such failure. I, therefore, impose a penalty of Rs. 10,000/- upon the assessee.”

Thus, it is clear that the impugned order was passed by the Assessing

Officer prior to completion of the assessment and for non-compliance of

statutory notices issued U/s 142(1) of the Act. However, we find that the

Assessing Officer neither in the assessment order has initiated the penalty

proceedings U/s 271(1)(b) of the Act nor any show cause notice was

issued prior to the impugned order dated 07/12/2017 was passed U/s

271(1)(b) of the Act. The Assessing Officer, though, mentioned in the

order that there are 13 notices issued by the Assessing Officer U/s 142(1)

as well as 142(2) of the Act on various dates and some of the notices

were issued after 28/09/2017 as on 16/10/2017, 02/11/2017 and

24/11/2017. Therefore, after the notice dated 21/09/2017, the Assessing

Officer further issued three notices U/s 142(1) and 142(2) of the Act. At

the time of passing of assessment order dated 21/12/2017, the Assessing

Officer has finally stated at the end of the assessment order that the

ITA 888/JP/2018_ 5 Amar Bharti Vs. ACIT

show cause U/s 271(1)(b) of the Act is separately issued for non-

compliance of statutory notices. We further note that that the Assessing

Officer has passed another order dated 12/06/2018 U/s 271(1)(b) of the

Act for non-compliance of notice issued U/s 142(1) of the Act on various

dates as mentioned in the said notice as under:

Thus a second penalty order U/s 271(1)(b) of the Act was passed on

12/06/2018 on account of non-compliance of the 13 notices issued U/s

142(1) including the notice U/s 142(1) of the Act dated 21/09/2017. The

Assessing Officer initiated the penalty proceedings U/s 271(1)(b) of the

Act by issuing notice dated 21/12/2017. Therefore, prior to notice dated

21/12/2017, there was no show cause notice issued by the Assessing

Officer U/s 271(1)(b) of the Act. Further the second order passed by the

ITA 888/JP/2018_ 6 Amar Bharti Vs. ACIT Assessing Officer U/s 271(1)(b) of the Act dated 12/06/2018 was against

the consolidated default by the assessee for non-compliance of all the

statutory notices including the notice U/s 142(1) dated 21/09/2017.

Hence, it is evident from the record that the impugned order dated

07/12/2017 was passed by the Assessing Officer without initiation of

penalty proceedings and without issuing any show cause notice U/s

271(1)(b) of the Act. The only show cause notice was issued by the

Assessing Officer was dated 21/12/2017 which was subsequent to the

impugned order passed U/s 271(1)(b) of the Act. Further when the

Assessing Officer has again passed a penalty order for non-compliance of

the notices including the notice dated 21/09/2017 then the impugned

order passed by the Assessing Officer without initiation of penalty

proceedings is illegal and void ab-initio. Accordingly, we quash the

impugned order dated 07/12/2017 passed U/s 271(1)(b) of the Act.

Order pronounced in the open court on 18/09/2018.

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:- 18th September, 2018

ITA 888/JP/2018_ 7 Amar Bharti Vs. ACIT *Ranjan आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू vihykFkhZ@The Appellant- Shri Amar Bharti, Jaipur. 1. izR;FkhZ@ The Respondent- The ACIT, Ward-1(3), 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. 888/JP/2018) 6. vkns'kkuqlkj@ By order,

सहायक पंजीकार@Aेेज. त्महपेजतंत