GANESH INDUSTRIES,,GANDHINAGAR vs. THE INCOME TAX OFFICER, WARD-2,, GANDHINAGAR

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “A” BENCH AHMEDABAD BEFORE, SHRI S. S. GODARA, JUDICIAL MEMBER AND SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER ITA No. 983/Ahd/2015 (Assessment Year: 2010-11) Ganesh Industries, 157, Pinudarda Village, Gandhinagar – 382009 Appellant Vs. The ITO, Ward-2, Gandhinagar Respondent PAN: AAIFG1106D आवेदक क� ओर से/By Assessee : Aditi Sheth, A.R. राज�व क� ओर से/By Revenue : Shri Keyur Patel, Sr. D.R सुनवाई क� तार�ख/Date of Hearing : 13.12.2017 घोषणा क� तार�ख/Date of : 10.01.2018 Pronouncement ORDER PER S. S. GODARA, JUDICIAL MEMBER

This assessee’s appeal for assessment year 2010-11, arises against the CIT(A)-7, Ahmedabad’s order dated 28.01.2015, in case no. CIT(A)-7/255/13-14, upholding Assessing Officer’s action imposing penalty of Rs.9,88,145/- after refusing to condone the delay in question, in proceedings u/s.271(1)(c) of the Income Tax Act, 1961, hereinafter ‘the Act’. Heard both the parties. Case file perused.

ITA No. 983/Ahd/15 [Ganesh Industries vs. ITO] A.Y. 2010-11 - 2- imposing the impugned penalty pertaining to disallowances/additions u/s.40A(3), sundry creditors and remuneration to partners of Rs.28,10,631/-, Rs.3,15,000/- and Rs.72,252/-; respectively as under:

“3. In this case, the penalty order u/s. 271(l)(c) of the I.T. Act, has been passed by the ITO, Ward-3, Gandhinagar on 25.09.2013 and served upon the assessee on 22.10.2013. The appeal has been filed on 03.01.2014. As per Section 249(2), the appeal is to be filed within 30 days of service of the order i.e. the appeal should have been filed before 23.11.2013, but the appeal has been filed beyond 30 days. The appellant has filed condonation petition, under: "(i) The factory of the appellant firm is not running and has been closed for over last one year. Hence, the partners of the appellant firm do not visit the factory premises frequently. (ii) The order of the ld. AO was received at the factory premises en 22/10/2013. Since at the partners of the appellant firm do not visit the factory premises on regular basis, the order so received at the factory premises remained unattended. (ii) Later, partner of the appellant firm visited the factory premises on 20/12/2013 and learnt that the impugned order has been passed in appellant's case. He therefore forwarded the same to his Chartered Account on 24/12/2013, The said Chartered Account forwarded the impugned order to the concerned Advocate on 31/12/2013. In turn, the concerned Advocate prepared From no. 35 alongwith and forwarded the same to the appellant to appellant to sign From No. 35 on the very day i.e. on 01/01/2014. Thereafter, the appeal came to be filed before Your Honours on 03/01/2014. Under the circumstances stated above, the delay in filing the appeal is mainly on account of the fact that the factory of the appellant firm has been closed for over last one year and consequently, the order so received at the factory premises remained unattended. Hence, it is prayed to Your Honours that there is good sufficient reason to condone the delay and therefore the delay in filing the appeal may kindly be condoned and the appeal may kindly he decided on merits.” 3.1 I have considered the above. The reasons given by the appellant for not filing appeal in time is that the factory of the appellant firm has been closed for last one year, hence, the partners of the appellant firm do not visit the factory frequently, hence the order sent at the factory premises remained unattended. The reasons given by the appellant is not satisfactory as the partner of the appellant has given the same address in the return of income and even in form No. 35 filed before the CIT(A), The appellant was required to give the address for communication where he could receive the notices, etc. and comply promptly. The reason for the delay in filing the appeal given by the appellant is not sufficient cause for not presenting the appeal within 30 days. 3.2 Considering the above facts, I am therefore, not satisfied that the appellant had sufficient cause for not presenting the appeal within the period of 30 days. The appeal is not admitted and accordingly dismissed.”

ITA No. 983/Ahd/15 [Ganesh Industries vs. ITO] A.Y. 2010-11 - 3- has admittedly sought to explain the same on the ground that the factory in question remained closed. Its further case was that the Assessing Officer’s penalty order could be received by its partners’ visit on random basis only. Learned CIT(A) is of the view that the mere fact is that the assessee has been continuing with the same address throughout sufficiently indicates that the above reason is not satisfactory. We find no reason to concur with the same. Learned CIT(A) fails to rebut assessee’s main plea of its business premises lying closed. That forms a much substantial reason for us to accept its plea that its partners do not visit the same premises very often so as to conclude that the impugned delay is neither intentional nor deliberate. We therefore accept assessee’s sole substantive ground for statistical purposes. The CIT(A) is directed to adjudicate assessee’s appeal challenging correctness of the above penalty imposed as per law after affording adequate opportunity of hearing.

[Pronounced in the open Court on this the 10th day of January, 2018.]

Sd/- Sd/- (PRADIP KUMAR KEDIA) (S. S. GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad: Dated 10/01/2018 True Copy S.K.SINHA आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. राज�व / Revenue 2. आवेदक / Assessee 3. संबं�धत आयकर आयु�त / Concerned CIT 4. आयकर आयु�त- अपील / CIT (A) 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड� फाइल / Guard file. By order/आदेश से,

उप/सहायक पंजीकार आयकर अपील�य अ�धकरण, अहमदाबाद ।