THE BANGA COOPERATIVE MARKETING SOCIETY LIMITED,BANGA vs. INCOME TAX OFFICER, NAWANSHAHAR

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ITA 359/ASR/2018Status: DisposedITAT Amritsar16 January 2019AY 2010-115 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the notice issued by the AO under Section 274 r.w.s. 271 of the Act was invalid as it did not specify whether the penalty was for concealment of income or furnishing inaccurate particulars. Therefore, the penalty was deleted.

What were the facts?

The assessee filed a return declaring nil income, later revised to declare additional income. The Assessing Officer (AO) framed the assessment at a higher income and initiated penalty proceedings under Section 271(1)(c) for furnishing inaccurate particulars of income.

What were the issues?

Whether a penalty notice under Section 271(1)(c) is valid if it fails to specify which limb of the section is invoked, and whether such a notice is bad in law.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 274

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(2)Show list

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Income Tax Appellate Tribunal, CAMP BENCH AT JALANDHAR

Before: Sh. N. K. Saini, Hon’ble & Sh. Ravish Sood

Hearing: 11.01.2019Pronounced: 16.01.2019

IN THE INCOME TAX APPELLATE TRIBUNAL CAMP BENCH AT JALANDHAR Before Sh. N. K. Saini, Hon’ble Vice President and Sh. Ravish Sood, Judicial Member ITA No.358/Asr./2018 : Asstt. Year : 2009-10 ITA No.359/Asr./2018 : Asstt. Year : 2010-11 ITA No.362/Asr./2018 : Asstt. Year : 2011-12 ITA No.363/Asr./2018 : Asstt. Year : 2014-15 The Banga Co-operative Vs Income Tax Officer, Marketing Society Ltd., Dana Nawanshahar Mandi, Banga, Distt. SBS Nagar (APPELLANT) (RESPONDENT) PAN No. AAAAT6370M Assessee by : Sh. Nirmal Mahajan, CA Revenue by : Sh. Ankit Kumar Aggarwal, DR Date of Hearing : 11.01.2019 Date of Pronouncement : 16.01.2019

ORDER Per Bench: These four appeals by the assessee are directed against the separate orders each dated 29.03.2018 for the assessment years 2009-10 to 2011-12 and 2014-15 by the ld. CIT(A)-1, Jalandhar.

2.

Since, the issues involved are common and the appeals were heard together, so these are being disposed off by this consolidated order for the sake of convenience and brevity.

ITA Nos.358 & 359/Asr./2018 2 ITA Nos.362 & 363/Asr./2018 Banga Cooperative Marketing Society Ltd. 3. At the first instance, we will deal with the appeal in ITA No.358/Asr./2018 for the assessment year 2009-10. Following grounds have been raised in this appeal: “1. That the learned Commissioner of Income Tax (A) fell into grave error in confirming that the notice issued by AO u/s 274 without deleting the non-applicable limb is valid and within law.

2.

That the learned Commissioner of Income Tax (A) fell into grave error by applying the decision of Hon’ble Bombay High Court in CIT vs. Smt. Kaushalya, 216 ITR 660 without confronting the appellant and without differentiating the decision of Hon’ble Apex Court in the case of CIT vs SSA’s Emerald Meadows.

3.

That the learned Commissioner of Income Tax (A) fell into grave error holding that the assessee was aware of excess claim of deduction u/s 80P.

4.

That the learned CIT(A) fell into great error by confirming the penalty of Rs. 55,690/-.”

4.

The only issue involved relates to the confirmation of penalty levied by the AO u/s 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as the Act).

5.

Facts of the case in brief are that the assessee filed the return of income on 03.09.2009 declaring a Nil income. Later on, the case was reopened u/s 148 of the Act and the assessee declared additional income of Rs.1,58,960/-. However, the AO framed the assessment at an income of Rs.1,90,240/- and also initiated the penalty proceedings u/s 271(1)(c) of the Act for furnishing of inaccurate particulars of income. However, the penalty u/s 271(1)(c) of the Act was levied by the AO for concealment of inaccurate particulars of income.

ITA Nos.358 & 359/Asr./2018 3 ITA Nos.362 & 363/Asr./2018 Banga Cooperative Marketing Society Ltd. 6. Being aggrieved the assessee carried the matter to the ld. CIT(A) who sustained the penalty levied by the AO.

7.

Now the assessee is in appeal. The ld. Counsel for the assessee drew our attention towards page no. 31 of the assessee’s paper book which is the copy of the notice issued u/s 274 r.w.s. 271 of the Act and submitted that the AO has not mentioned as to whether the penalty proceedings were initiated for the concealment of particulars of income or furnishing inaccurate particulars of income because noting has been struck off in the said notice. It was also stated that the AO levied the penalty for concealment of income while the penalty proceedings u/s 271(1)(c) of the Act were initiated for furnishing inaccurate particular of income. Therefore, the penalty levied by the AO and sustained by the ld. CIT(A) was not justified. Reliance was also placed on the decision of the ITAT Delhi Bench “A”, New Delhi in the case of Aman Mehtani Vs DCIT, CC-I, Faridabad in ITA No. 4325/Del/2016 for the assessment year 2010-11, order dated 22.11.2017.

8.

In his rival submissions, the ld. DR strongly supported the impugned order passed by the ld. CIT(A) and reiterated the observations made therein.

9.

We have considered the submissions of both the parties and perused the material available on the record. It is noticed that an identical issue having similar facts has been adjudicated by the ITAT Delhi Bench ‘A’, New Delhi in the case of Aman Mehtani Vs DCIT (supra) wherein one of us (Vice President) is a co-signatory in the said order dated 22.11.2017, it has been held as under: “8. We have heard both the parties and perused the material available on record. There is no concealment in the present case. The Assessee has also filed all the details during the regular

ITA Nos.358 & 359/Asr./2018 4 ITA Nos.362 & 363/Asr./2018 Banga Cooperative Marketing Society Ltd. assessment proceedings. From the notice dated 28.12.2011 produced by the Ld. AR during the hearing, it can be seen that the Assessing Officer was not sure under which provisions of Section 271 of the Income Tax Act, 1961, the assessee is liable for penalty. The issue is squarely covered by the decision of the Hon'ble Supreme Court in case of M/s SSA’ Emerald Meadows. The extract of the Hon’ble Karnataka High Court in M/s. SSA’ Emerald Meadows are as under which was confirmed by the Hon’ble Apex Court: "3. The Tribunal has allowed the appeal filed by the assessee holding the notice issued by the Assessing Officer under Section 274 read with Section 271(l)(c) of the Income Tax Act, 1961 (for short ‘the Act’) to be bad in law as it did not specify which limb of Section 271(l)(c) of the Act, the penalty proceedings had been initiated i.e., whether for concealment of particulars of income or furnishing of inaccurate particulars of income. The Tribunal, while allowing the appeal of the assessee, has relied on the decision of the Division Bench of this Court rendered in the case of COMMISSIONER OF INCOME TAX -VS- MANJUNATHA COTTON AND GINNING FACTORY (2013) 359 ITR 565.

4.

In our view, since the matter is covered by judgment of the Division Bench of this Court, we are of the opinion, no substantial question of law arises in this appeal for determination by this Court. The appeal is accordingly dismissed. ”

10.

Since, the facts of the present case are similar to the aforesaid referred to case. So, respectfully following the aforesaid referred to order dated 22.11.2017, the impugned penalty levied by the AO and sustained by the ld. CIT(A) is deleted.

11.

In all other appeals in ITA Nos. 359, 362 & 363/Asr./2018, the facts are similar, the only difference is in the amount of penalty levied in each of the years. Therefore, our findings given in the former part of this order shall apply mutatis mutandis.

ITA Nos.358 & 359/Asr./2018 5 ITA Nos.362 & 363/Asr./2018 Banga Cooperative Marketing Society Ltd. 12. In the result, the appeals of the assessee are allowed. (Order Pronounced in the Court on 16/01/2019)

Sd/- Sd/- (Ravish Sood) (N. K. Saini) JUDICIAL MEMBER VICE PRESIDENT Dated: 16/01/2019 *Subodh* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5.DR: ITAT ASSISTANT REGISTRAR

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