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Income Tax Appellate Tribunal, “SMC” BENCH, AHMEDABAD
Before: MS. SUCHITRA KAMBLE
IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, AHMEDABAD BEFORE MS. SUCHITRA KAMBLE, JUDICIAL MEMBER I.T.A. Nos.262&263/Ahd/2022 (Assessment Year: 2015-16) Snehalben Kamalbhai Patel Vs. ADDL./JCIT, Plot No. 1355/2, TDS, Sector – 3/B, Ahmedabad Gandhinagar-382003 Ranchhodbhai Vitthalbhai Patel ADDL./JCIT, Plot No. 352, TDS, Sector-1/C, Sector-1, Ahmedabad Gandhinagar-382007 [PAN No.BCKPP4682G/ACGPP9103R] (Appellant) .. (Respondent) Appellant by : Shri M.K. Patel, Advocate Respondent by: Shri M. Anand Kumar, Sr. D.R. 21.12.2022 Date of Hearing 23.12.2022 Date of Pronouncement O R D E R
The appeals filed by the different assessee are against the order passed by the Ld. CIT(Appeals), National Faceless Appeal Centre (in short “NFAC”), Delhi on 12.05.2022 & 24.03.2022 for A.Y. 2015-16.
ITA No. 262/Ahd/2022 (A.Y. 2015-16):- The grounds of appeal raised by the assessee are as under: 2. “(1) That on facts, and in law, the learned NFAC has grievously erred in dismissing the appeal as infructuous against the levy of penalty of Rs.33,000/- u/s 271C of the Act. (2) That on facts, and in law, the learned NFAC ought to have deleted the penalty as the appellant is entitled to immunity from penalty as the appellant has opted for VSVS in respect of order u/s 201(1) of the Act. The appellant craves leave to add, alter, amend any ground of appeal.” (3)
ITA Nos. 262&263/Ahd/2022 Snehalben Kamalbhai Patel & Ranchhodbhai Vitthalbhai Patel vs. ADDL.CIT/JCIT Asst.Year–2015-16 - 2 - 3. The Assessing Officer observed that the assessee was liable to tax and deposit TDS as per the provisions of Section 194IA of the Income Tax Act from the consideration for the purchase of an immovable property of Rs. 1,65,00,000/- during the F.Y. 2014-15. The Assessing Officer further observed that the assessee failed to comply with the provisions relating to TDS and therefore, in view of the same order under Section 201(1)/201(1A) of the Income Tax Act was passed on 29.11.2019 and the assessee was considered to be default for non-deduction of TDS under Section 194IA of the Act. The Assessing Officer invoked provision of Section 271C of the Income Tax Act as the assessee was liable to pay the penalty for such default. After issuing notice dated 24.01.2020 the Assessing Officer imposed penalty of Rs. 33,000/- under Section 271C vide order dated 23.06.2021. In the meanwhile the assessee opted for direct tax Vivas se Vishwas Scheme (VSVS) and settled the dispute under Section 201(1) as the assessee’s appeal before the CIT(A) was pending on the quantum proceedings. Form No. 5 related to order for full and final settlement of tax arrears was issued by the Department on 09.04.2021.
Being aggrieved by the penalty order under Section 271C of the Act the assessee filed appeal before the CIT(A). The CIT(A) dismiss the appeal of the assessee.
The Ld. A.R. submitted that since the quantum under Section 201(1)(/201(1A) has already been settled as the assessee opted for the Vivad se Vishwas Scheme vide application dated 09.12.2020 the CIT(A) as well as the Assessing Officer should not have imposed the penalty. The Ld. A.R. further submitted that in the co-owners case the CIT(A) therein has deleted the penalty
ITA Nos. 262&263/Ahd/2022 Snehalben Kamalbhai Patel & Ranchhodbhai Vitthalbhai Patel vs. ADDL.CIT/JCIT Asst.Year–2015-16 - 3 - and the said direction should have been followed by the CIT(A) in the present case.
The Ld. D.R. relied upon the penalty and the order of the CIT(A).
Heard both the parties and perused all the relevant material available on record. It is pertinent to note that the assessee filed application dated 09.12.2020 wherein the assessee opted for Vivad se Vishwas Scheme and the Revenue issued Form No. 3 on 11.02.2021 thereby determining the settlement amount. Which was paid by the assessee on 19.03.2021 as per Form 4 and Form 5 was issued on 09.04.2021 thereby giving order for full and final settlement of tax arrears in respect of the dispute under Section 201(1)/201(1A) of the Act. Since the dispute is related to the quantum of 201(1) proceedings the same is already settled and therefore, penalty cannot be imposed subsequently under Section 271C of the Act. Thus, the penalty proceedings by the Department and confirm by the CIT(A) is deleted. The appeal of the assessee is being ITA No. 261/Ahd/2022 is allowed.
ITA No. 263/Ahd/2022(A.Y. 2015-16):- 8. The grounds of appeal filed by the assessee are as under: “(1) That on facts, and in law, the learned NFAC has grievously erred in dismissing the appeal as infructuous against the levy of penalty of Rs.33,000/- u/s 271C of the Act. (2) That on facts, and in law, the learned NFAC ought to have deleted the penalty as the appellant is entitled to immunity from penalty as the appellant has opted of VSVS in respect of order u/s 201(1) of the Act. (3) The appellant craves leave to add, alter, amend any ground of appeal.”
ITA Nos. 262&263/Ahd/2022 Snehalben Kamalbhai Patel & Ranchhodbhai Vitthalbhai Patel vs. ADDL.CIT/JCIT Asst.Year–2015-16 - 4 -
There is delay of 36 days in filing the present appeal which has been explained by the assessee by giving the reasons for delay. The reasons appear to be genuine hence the delay is condoned.
As regards, ITA No. 263/Ahd/2022 the same is related to the co-owner of the land and identical order under Section 201(1)/201(1A) of the Act was passed therein the assessee has opted for VSVS and Form No. 5 dated 09.04.2021 was issued in respect of full and final settlement of tax arrears by the Department. The issue is identical and the penalty imposed therein does not sustain. Hence, ITA No. 263/Ahd/2022 is allowed.
In the result, both these appeals filed by the assessee are allowed. This Order pronounced in Open Court on 23/12/2022
Sd/- (SUCHITRA KAMBLE) JUDICIAL MEMBER Ahmedabad; Dated 23/12/2022 TANMAY, Sr. PS TRUE COPY आदेश क� ��त�ल�प अ�े�षत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant 2. ��यथ� / The Respondent. 3. संबं�धत आयकर आयु�त / Concerned CIT 4. आयकर आयु�त(अपील) / The CIT(A)- 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER,
उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपील�य अ�धकरण, अहमदाबाद / ITAT, Ahmedabad