MEENA JAIN,JAIPUR vs. ITO, KOTA

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ITA 442/JPR/2017Status: DisposedITAT Jaipur15 September 2017AY 2007-084 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the original assessment order, which initiated the penalty proceedings, had been set aside by a previous ITAT order. Therefore, the penalty order was also set aside and restored to the Assessing Officer for fresh decision.

What were the facts?

The assessee's case was reopened, and assessment was framed under section 147 read with 148. Penalty proceedings under section 271(1)(c) were initiated and later confirmed by the CIT(A). The assessee appealed this confirmation.

What were the issues?

Whether penalty proceedings under section 271(1)(c) can survive when the original assessment order initiating them has been set aside. The validity of the penalty notice was also questioned.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 147,Section 148,Section 274

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, JAIPUR BENCHES, JAIPUR

Before: SHRI BHAGCHAND, AM & SHRI KUL BHARAT, JM vk;dj vihy la-@ITA No. 442/JP/2017

For Appellant: Shri Devang Gargieya (ITP) jktLo dh vksj ls@
For Respondent: Shri Rajendra Singh (JCIT)
Hearing: 14.09.2017Pronounced: 15.09.2017

PER SHRI KUL BHARAT, JM.

This appeal by the Assessee is directed against the order of Ld. CIT (A)-22,

Alwar dated 28/04/2017 pertaining to A.Y. 2007-08.

The assessee has raised the following grounds of appeal:-

“1. The impugned penalty order u/s 271(1)(c) of the Act dated 25.03.2013 is bad in law and on facts of the case, for want of jurisdiction and various other reasons and hence, the same kindly be quashed.

2.

Rs. 6,98,330/- : The Ld. CIT(A) erred in law as well as on the facts of the case in confirming the impugned penalty u/s 271(1)(c) of the Act of Rs. 6,98,330/-. The penalty so imposed & confirmed being totally contrary to the provisions of law and facts kindly be deleted in full.

3.

That the show cause notice issued u/s 274 r/w 271(1)(c) of the Act, is quite vague and did not at all specify which limb of section 271(1)(c) of the Act, the penalty proceedings had been initiated i.e., whether the concealment particulars of income of furnishing of inaccurate

2 ITA No. 442/JP/2017. Smt. Meena Jain, Kota.

particulars of income. The impugned penalty based on such a notice being contrary to the provisions of law & facts kindly be quashed.

4.

The appellant prays your honour indulgences to add, amend or alter of or any of the grounds of the appeal on or before the date of hearing.”

2.

Briefly stated the facts are that, the case of the assessee was reopened for

assessment and the assessment was framed under section 147 read with 148 of the

Income-Tax Act, 1961 (hereinafter referred to as the Act) vide order dated

31/03/2007. While framing the assessment, the AO also initiated penalty

proceedings u/s 271(1)(c) of the Act. Subsequently, the penalty was imposed vide

order dated 25/03/2013. The Assessing Officer has recorded the followings facts as

under:-

“9. The assessee filed his written reply on 19.02.2013 in response to show cause notice issued by this office vide No. ITO/W-2(1)/KTA/2012- 13/839 dated 08.02.2013 stating therein that under the circumstances it is request your good self that as we have declared all particulars and paid tax accordingly should not be considered a concealment of income and it is request to drop the proceedings. However, an appeal was pending before the Hon’ble ITAT, Jaipur Bench Jaipur vide ITA No. 144/JP/2011 and therefore, it is request your good self to kept in abeyance till the disposal of appeal.

10.

Reply of the assessee considered carefully but found no substance therein. Penalty cannot be kept in abeyance looking to the instruction of the Central Board of Direct Taxes which are that penalty proceedings must be decided within one year from the end of F.Y. in which CIT(A)’s order has been received. Being a time barring case as on 31.03.2013 penalty is being decided on merits.

3 ITA No. 442/JP/2017. Smt. Meena Jain, Kota.

3.

On appeal Ld. CIT(A) confirmed the penalty. Now, the assessee is in further

appeal before this Tribunal.

4.

At the outset, Ld. Counsel for the assessee submitted that assessment order

dated 31/3/2007 by which the impugned penalty proceeding were initiated, was set

aside by the Tribunal in ITA No. 1144/JP/2011. Therefore, he submitted that the

present proceedings would not survive as the quantum order has been set aside.

5.

Ld. D/R did not oppose this submission of the Ld. Counsel for the assessee.

He conceded the fact that the Tribunal has set aside the assessment order to the file

of the AO for afresh consideration.

6.

We have heard the rival contention, We find that identical issue was came up

before the ITAT in ITA No. 1144/JP/2011 in assessee’s own case has held as under:-

“5.4 In Revenue’s appeal also, the action of the Ld. CIT(A) is challenged for entertaining the additional evidence i.e. valuation report without following the due process of law u/r 46A and giving opportunity of being heard to the assessee. The Ld. Counsel for the assessee proposed that in these circumstances if the bench so finds appropriate, the assessee has no objection if the reassessment proceedings are set aside and the matter is restored back to the file of the AO to decide the same afresh by providing reasonable opportunity of being heard on this issues. Thus, in view of the foregoing facts and circumstances, it is to be ascertained from the record whether the reasons were provided to the assessee and any objection in this behalf was filed by the assesee has been decided or not. Besides as the validity of the reasons is to be examined along with the merits. Both the parties are aggrieved on merits. Both the parties are aggrieved on merits of part retention of the addition and part relief of the addition. In consideration of the entirety of facts and circumstances of the case, we find merit in the proposition of the Ld. Counsel for the assessee to set aside the matter back to the file of the AO to decide these issues in respect of the validity of 148

4 ITA No. 442/JP/2017. Smt. Meena Jain, Kota.

proceedings and merits of the case denovo after providing adequate opportunity of being heard to the assessee. Thus the appeal of the Revenue and C.O. of the assessee are allowed for statistical purposes.”

6.1 In view of the above, the penalty order is set aside and the issue of levy of

penalty is restored to the file of the Assessing Officer to be decided afresh. Grounds

raised in this appeal are allowed for statistical purpose.

7.

In the result, appeal of the assessee in ITA No. 442/JP/2017 is allowed for

statistical purpose.

Order is pronounced in the open court on Friday, the 15th day of September 2017. Sd/- Sd/- ( HkkxpUn ½ ( dqy Hkkjr) ( BHAGCHAND) ( KUL BHARAT ) ys[kk lnL;@Accountant Member U;kf;d lnL;@Judicial Member Jaipur Dated: 15/09/2017 Pooja/ आदेश की प्रतिलिपि अग्रेषित@ब्वचल वf जीम वतकमत वितूंतकमक जवरू

1.

The Appellant- Smt. Meena Jain , Kota. 2. The Respondent – The ITO, Ward-2(1), Kota. 3. The CIT(A). 4. The CIT, 5. The DR, ITAT, Jaipur 6. Guard File (ITA No. 442/JP/2017)

vkns'kkuqlkj@ By order,

सहायक पंजीकार@ Aेेपेजंदज. त्महपेजतंत

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