RAKESH AGARWAL,SILIGURI vs. I.T.O.,WARD-2(2), KOLKATA

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ITA 1887/KOL/2019Status: DisposedITAT Kolkata09 December 2020AY 2015-162 pages
AI SummaryAllowed

What did the Tribunal hold?

The tribunal held that the penalty order was vague as it did not clearly specify the charge for which the penalty was levied. Furthermore, the income was assessed on an estimate basis, which, coupled with the ambiguity in the penalty order, led to the cancellation of the penalty.

What were the facts?

The assessee's appeal was against a penalty levied under Section 271(1)(c) of the Income Tax Act. The assessment was completed under Section 143(3) based on an estimation of income from bank deposits under Section 44AD.

What were the issues?

The key issues were the vagueness of the penalty order regarding the specific charge (concealment vs. inaccurate particulars) and whether a penalty could be levied when income was determined on an estimated basis.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 143(3),Section 44AD,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, KOLKATA ‘C’ BENCH, KOLKATA

Before: Sri J. Sudhakar Reddy & Sri S.S. Godara

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA ‘C’ BENCH, KOLKATA (Virtual Court) (Before Sri J. Sudhakar Reddy, Accountant Member & Sri S.S. Godara, Judicial Member) Assessment Year: 2015-16 Rakesh Agarwal...................................................................................................................Appellant [PAN: ADRPA 1425 B] Vs. ITO, Ward-2(2), Siliguri.....………………..…..................................................................Respondent Appearances by: None appeared on behalf of the Assessee. Sh. Supriyo Paul, Addl. CIT, appeared on behalf of the Revenue. Date of concluding the hearing : December 3rd, 2020 Date of pronouncing the order : December 9th, 2020 ORDER Per J. Sudhakar Reddy, AM:

This is an appeal filed by the assessee directed against the penalty levied u/s 271(1)(c) of the Income Tax Act, 1961 (the ‘Act’) against the order of the Learned Commissioner of Income Tax (Appeals), Siliguri, [hereinafter the “CIT(A)”], passed u/s. 250 of the Act dated 19.06.2019 for the Assessment Year 2015-16.

2.

None appeared on behalf of the assessee despite issue of notice. There is no petition for adjournment either. Under these circumstances we dispose off the case ex- parte qua the assessee after hearing the ld. D/R.

3.

Heard ld. D/R. The assessment in this case has been computed u/s 143(3) of the Act on 22.12.2017, determining the total income of the assessee u/s 44AD of the Act. 8% of the total deposits made in the assessee’s bank account during the financial year 2014- 15 were estimated as the income. Penalty u/s 271(1)(c) of the Act was levied. The assessee’s contention is that no penalty can be levied, when income is determined on estimate basis. In our view, the penalty order does not specify the charge on which penalty is being levied i.e. penalty for concealment of income or furnishing inaccurate

Assessment Year: 2015-16 Rakesh Agarwal. particular of income. While the assessment order states that proceedings u/s 271(1)(c) of the Act have been initiated for concealment of income, the penalty order states that the penalty has been levied in respect of concealed as well as furnishing inaccurate particular of income. Moreover, the income is assessed on estimate basis. Under these circumstances we cancel the penalty levied and allow the appeal of the assessee.

4.

In the result, the appeal filed by the assessee is allowed. Kolkata, the 9th December, 2020. Sd/- Sd/- [S.S. Godara] [J. Sudhakar Reddy] Judicial Member Accountant Member Dated: 09.12.2020 Bidhan (P.S.) Copy of the order forwarded to:

1. 1. Rakesh Agarwal, C/o. Subash Agarwal & Associates, Advocates Siddha Gibson, 1, Gibson Lane, Suite 213, 2nd Floor, Kolkata-700 069.

2. ITO, Ward-2(2), Siliguri.

3. CIT(A), Siliguri. (sent through mail) 4. CIT- 5. CIT(DR), Kolkata Benches, Kolkata. (sent through mail)

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