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Income Tax Appellate Tribunal, KOLKATA ‘C’ BENCH, KOLKATA
Before: Sri J. Sudhakar Reddy, Hon’ble & Sri Aby T. Varkey, Hon’ble
IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA ‘C’ BENCH, KOLKATA (Before Sri J. Sudhakar Reddy, Hon’ble Accountant Member & Sri Aby T. Varkey, Hon’ble Judicial Member) [VIRTUAL COURT HEARING] Assessment Years: 2013-14 M/s. Bhag Chand Chhabra HUF.....................................................................………………....….....Appellant 4A, Gokhale Road Kolkata - 700020 [PAN : AAEHB 3652 H] Vs. Income Tax Officer, Ward-34(3), Kolkata………………...............……...........….……....…… Respondent Appearances by: None, appeared on behalf of the assessee. Shri Supriyo Pal, JCIT D/R, appearing on behalf of the Revenue. Date of concluding the hearing : July 20th, 2020 Date of pronouncing the order : July 24th, 2020 ORDER Per J. Sudhakar Reddy, AM :-
This appeal filed by the assessee is directed against the order of the Learned Commissioner of Income Tax (Appeals) – 10, Kolkata, (hereinafter the “ld.CIT(A)”), passed u/s. 250 of the Income Tax Act, 1961 (the ‘Act’), dt. 31/12/2018, for the Assessment Year 2013-14, wherein, he confirmed the penalty levied u/s 271(1)(c) of the Act, by the Assessing Officer .
None appeared on behalf of the assessee. There is no application for adjournment either. Under these circumstances, we dispose off the case ex-parte on merits qua the assessee after hearing the ld. Departmental Representative.
Heard the ld. D/R. We find that the assessee had raised the following ground before the ld. CIT(A):-
4. That in the facts and circumstances of the case the Ld. ITO erred in imposing penalty although the show cause notice for penalty did not clarify for what default the penalty has been initiated whether it is for furnishing inaccurate particulars.” 3.1. The ld. CIT(A) has not contradicted the claim of the assessee that, the notice issued u/s 271(1)(c) of the Act, did not specify the charges against which the penalty was sought to be imposed. The penalty imposed in pursuance of such defective notice is not sustainable in law. The Hon’ble Jurisdictional High Court in the case of Pr. CIT vs. Dr. Murari Mohan Koley in ITAT No. 306 of 2017, G.A. No. 2968 of 2017, judgment dt. 18th July, 2018, held as follows:-
10. The ld. Counsel for the assessee drew our attention to the decision of the Hon'ble Karnataka High Court in the case of CIT vs. SSA's Emerald Meadows in of 2015 Assessment Years: 2013-14 M/s. Bhag Chand Chhabra HUF M/s. Bhag Chand Chhabra HUF dated 23.11.2015 wherein the Hon'ble Karnataka High Court following its own decision in dated 23.11.2015 wherein the Hon'ble Karnataka High Court following its own decision in dated 23.11.2015 wherein the Hon'ble Karnataka High Court following its own decision in the case of CIT vs Manjunatha Cotton and Ginning CIT vs Manjunatha Cotton and Ginning factory (2013) 359 ITR 565 took a view factory (2013) 359 ITR 565 took a view that imposing of penalty u/s that imposing of penalty u/s. 271(1)(c) of the Act is bad in law and invalid for the reason . 271(1)(c) of the Act is bad in law and invalid for the reason that the show cause notice u/s 274 of the Act does not specify the charge against the that the show cause notice u/s 274 of the Act does not specify the charge against the that the show cause notice u/s 274 of the Act does not specify the charge against the assessee as to whether it is for concealment of particulars of income or furnishing of assessee as to whether it is for concealment of particulars of income or furnishing of assessee as to whether it is for concealment of particulars of income or furnishing of inaccurate particulars of income. The ld. Counsel further brought to our notice that as ars of income. The ld. Counsel further brought to our notice that as ars of income. The ld. Counsel further brought to our notice that as against the decision of the Hon'ble Karnataka High Court the revenue preferred an appeal against the decision of the Hon'ble Karnataka High Court the revenue preferred an appeal against the decision of the Hon'ble Karnataka High Court the revenue preferred an appeal in SLP in CC No.11485 of 2016 and the Hon'ble Supreme Court by its order dated 05.08.2016 in SLP in CC No.11485 of 2016 and the Hon'ble Supreme Court by its order dated 05.08.2016 in SLP in CC No.11485 of 2016 and the Hon'ble Supreme Court by its order dated 05.08.2016 dismissed the SLP preferred by the department. The ld. Counsel also brought to our notice d the SLP preferred by the department. The ld. Counsel also brought to our notice d the SLP preferred by the department. The ld. Counsel also brought to our notice the decision of the Hon'ble Bombay High Court in the case of CIT vs Shri Samson Perinchery the decision of the Hon'ble Bombay High Court in the case of CIT vs Shri Samson Perinchery the decision of the Hon'ble Bombay High Court in the case of CIT vs Shri Samson Perinchery in of 2014 dated 05.01.2017 wherein the Hon'ble Bombay High Court follo in ITA No.1154 of 2014 dated 05.01.2017 wherein the Hon'ble Bombay High Court follo in ITA No.1154 of 2014 dated 05.01.2017 wherein the Hon'ble Bombay High Court following the decision of the the Hon'ble Karnataka High Court in the case of of the decision of the the Hon'ble Karnataka High Court in the case of of CIT vs Manjunatha CIT vs Manjunatha Cotton and Ginning factory (supra) came to the conclusion that imposition of penalty on factory (supra) came to the conclusion that imposition of penalty on factory (supra) came to the conclusion that imposition of penalty on defective show cause notice without specifying the charge against the assessee cannot be otice without specifying the charge against the assessee cannot be otice without specifying the charge against the assessee cannot be sustained. Our attention was also drawn to the decision of ITAT in the case of Suvaprasanna sustained. Our attention was also drawn to the decision of ITAT in the case of Suvaprasanna sustained. Our attention was also drawn to the decision of ITAT in the case of Suvaprasanna Bhattacharya vs ACIT in ITA NO 1303/Kol/2010 dated 06.11.2015 wherein identical Bhattacharya vs ACIT in ITA NO 1303/Kol/2010 dated 06.11.2015 wherein identical Bhattacharya vs ACIT in ITA NO 1303/Kol/2010 dated 06.11.2015 wherein identical proposition has been followed by the Tribunal. The learned DR relied on the order of the een followed by the Tribunal. The learned DR relied on the order of the een followed by the Tribunal. The learned DR relied on the order of the CIT(A).
We have already observed that the show cause notice issued in the present case u/s 274 11. We have already observed that the show cause notice issued in the present case u/s 274 11. We have already observed that the show cause notice issued in the present case u/s 274 of the Act does not specify the charge against the assessee as to whether it is for of the Act does not specify the charge against the assessee as to whether it is for of the Act does not specify the charge against the assessee as to whether it is for concealing particulars of income or furnishing inaccurate particulars of income. The show cause notice particulars of income or furnishing inaccurate particulars of income. The show cause notice particulars of income or furnishing inaccurate particulars of income. The show cause notice u/s 274 of the Act does not strike out the inappropriate words. u/s 274 of the Act does not strike out the inappropriate words. In these circumstances, we are of the view that imposition of penalty cannot be sustaine In these circumstances, we are of the view that imposition of penalty cannot be sustaine In these circumstances, we are of the view that imposition of penalty cannot be sustained. The plea of the ld. Counsel for the assessee which is based on the decisions referred to in the The plea of the ld. Counsel for the assessee which is based on the decisions referred to in the The plea of the ld. Counsel for the assessee which is based on the decisions referred to in the earlier part of this order has to be accepted. We therefore hold that imposition of penalty in earlier part of this order has to be accepted. We therefore hold that imposition of penalty in earlier part of this order has to be accepted. We therefore hold that imposition of penalty in the present case cannot be sustained and the same is directed the present case cannot be sustained and the same is directed to be cancelled. " to be cancelled. " Mr. Chowdhury in course of argument has urged us to remand the matter before the Mr. Chowdhury in course of argument has urged us to remand the matter before the Mr. Chowdhury in course of argument has urged us to remand the matter before the assessing officer. According to him, this was a technical flaw, which the Revenue must be assessing officer. According to him, this was a technical flaw, which the Revenue must be assessing officer. According to him, this was a technical flaw, which the Revenue must be given a chance to cure. The reason why the penalty order was not given a chance to cure. The reason why the penalty order was not sustained by the Tribunal sustained by the Tribunal appears from the passages of the decision of the Tribunal quoted earlier in this judgement. appears from the passages of the decision of the Tribunal quoted earlier in this judgement. appears from the passages of the decision of the Tribunal quoted earlier in this judgement. We find that there was no specific charge against the assessee in the notice. Revenue has We find that there was no specific charge against the assessee in the notice. Revenue has We find that there was no specific charge against the assessee in the notice. Revenue has missed out their opportunity to subject the ass missed out their opportunity to subject the assessee to the penalty proceeding by not issuing essee to the penalty proceeding by not issuing a proper notice. No specific case has been made out by the Revenue as to why the matter a proper notice. No specific case has been made out by the Revenue as to why the matter a proper notice. No specific case has been made out by the Revenue as to why the matter should be remanded except that the assessee had not participated properly in the should be remanded except that the assessee had not participated properly in the should be remanded except that the assessee had not participated properly in the assessment proceedings but for that reas assessment proceedings but for that reason best judgment assessment has been made and on best judgment assessment has been made and the income, which had escaped assessment has been added to the income of the assessee. It the income, which had escaped assessment has been added to the income of the assessee. It the income, which had escaped assessment has been added to the income of the assessee. It was incumbent upon the Revenue to make out a specific case for imposition of penalty, on was incumbent upon the Revenue to make out a specific case for imposition of penalty, on was incumbent upon the Revenue to make out a specific case for imposition of penalty, on which count the Revenue has fai which count the Revenue has failed. Under such circumstances, we do not find any reason to interfere with the Tribunal's order. Under such circumstances, we do not find any reason to interfere with the Tribunal's order. Under such circumstances, we do not find any reason to interfere with the Tribunal's order. The Tribunal's order does not suffer from any error of law. No substantial question of law is The Tribunal's order does not suffer from any error of law. No substantial question of law is The Tribunal's order does not suffer from any error of law. No substantial question of law is involved in this appeal. Hence, the same is dismissed. Hence, st involved in this appeal. Hence, the same is dismissed. Hence, stay petition is also dismissed. ay petition is also dismissed. There shall be no order as to costs. There shall be no order as to costs.
The proposition of law laid down in the above case The proposition of law laid down in the above case-law is squarely applicable in squarely applicable in the present case. We, therefore, respectfully follow the present case. We, therefore, respectfully following the said decision of the the said decision of the Hon’ble
Assessment Years: 2013-14 M/s. Bhag Chand Chhabra HUF M/s. Bhag Chand Chhabra HUF Jurisdictional High Court, quash l High Court, quash the impugned penalty imposed by the penalty imposed by the Assessing Officer under section 271(1)(c) of the Act of the Act and confirmed by the Ld. CIT(A). and confirmed by the Ld. CIT(A). 5. In the result, appeal of the assessee In the result, appeal of the assessee is allowed. Kolkata, the Kolkata, the 24th day of July, 2020.
Sd/- Sd/- [Aby T. Varkey] [J. Sudhakar Reddy J. Sudhakar Reddy] Judicial Member Accountant Member Accountant Member Dated : 24.07.2020 {SC SPS} Copy of the order forwarded to:
1. 1. M/s. Bhag Chand Chhabra HUF M/s. Bhag Chand Chhabra HUF 4A, Gokhale Road Kolkata - 700020 2. Income Tax Officer, Ward-34(3), Kolkata 34(3), Kolkata 3. CIT(A)- 4. CIT- , 5. CIT(DR), Kolkata Benches, Kolkata.
5. CIT(DR), Kolkata Benches, Kolkata.