SHALIN TANDON (LEGAL HEIR OF LATE SHRI SANDEEP TANDON),MUMBAI vs. JT. CIT -19(2), MUMBAI

1 Assessment Year-2007-08 आयकर अपीलीय अिधकरण “जी” "ायपीठ मुंबई म"। IN THE INCOME TAX APPELLATE TRIBUNAL “G” BENCH, MUMBAI

माननीय "ी संद"प गोसांई, "ाियक सद" एवं माननीय "ी मनोज कुमार अ"वाल ,लेखा सद" के सम"। BEFORE HON’BLE SHRI SANDEEP GOSAIN, JM AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकरअपील सं./ I.T.A. No.3284/Mum/2018 (िनधा"रणवष" िनधा"रणवष" / Assessment Year: 2007-08) िनधा"रणवष" िनधा"रणवष" Shri Shalin Tandon JCIT-19(2) (Legal Heir of Late Shri Sandeep Tandon) Mumbai – 400 021 बनाम नाम नाम/ नाम 147, 4th Floor Vs. Atlanta, Nariman Point Mumbai-400 021. ःथायीलेखासं ःथायीलेखासं./जीआइआरसं ःथायीलेखासं ःथायीलेखासं जीआइआरसं जीआइआरसं./PAN/GIR No. AAAPT-1953-H जीआइआरसं (अपीलाथ"/Appellant) (ू"यथ" / Respondent) :

: Shri Jitendra Jain- Ld.AR अपीलाथ"क"ओरसे/ Appellant by : Chaudhury Arun Kumar, Ld. DR ू"यथ" क" ओर से/Respondent by सुनवाईक"तार"ख/ : 08/07/2019 Date of Hearing घोषणाक"तार"ख / : 30/07/2019 Date of Pronouncement आदेश / O R D E R

Manoj Kumar Aggarwal (Accountant Member): - 1. Section 272A(2)(c) of the Income Tax Act, 1961 (in short ‘Act’) provides that if any person fails to furnish in due time any of the returns, statements or particulars mentioned in Section 133 or Section 206 or 2 Assessment Year-2007-08 Section 206C or Section 285B then he shall pay, by way of penalty, a sum of Rs.100/- for every day during which the failure continues. Similarly, as per the provisions of Section 272A(1)(b), if any person refuses to sign any statement made by him in the course of any proceedings under this Act, which an Income Tax Authority may legally require him to sign, he shall pay, by way of penalty, a sum of Rs.10,000/- for each such default or failure. Section 273B exonerate assessee from imposition of penalty u/s 272(A)(1) / (2), if the assessee proves that there was reasonable cause for the said failure. As per Clause(6) of Section 133 of the Act, the authorities may require any person to furnish information in relation to such points or matters or furnish statements of account and affairs in the prescribed manner giving information in relation to such points or matters as in the opinion of authorities will be useful or relevant to any enquiry or proceedings under the Act. 2.1 Invoking the provisions of Section 272A(2)(c) against the legal heir namely Mr. Shalin Tandon, who happens to be a legal heir of his deceased father namely Late Sh. Sandeep Tandon, Ld. Joint Commissioner of Income Tax, Range-19(2), Mumbai imposed a penalty of Rs.36,400/- vide order dated 30/12/2014 on account of willful non-compliance of notice dated 19/12/2013 issued u/s 133(6) of the Act. While doing so, the requisite show- cause notice u/s 274 r.w.s. 272A(2)(c) was issued to the assessee on various dates. As per material on record, the deceased assessee expired on 17/03/2010. 3 Assessment Year-2007-08 2.2 The facts leading to the imposition of said penalty are that the assessee, being legal heir of his father, was assessed in respect of his father’s income u/s 143(3) r.w.s. 147 on 23/03/2015 wherein the income was determined at Rs.28.09 Crores. The reassessment proceedings were triggered pursuant to receipt of certain document (referred to as a Base Note) containing personal details of the deceased assessee and details of bank account held by the deceased assessee in HSBC Bank, Geneva. These details were confronted to the legal heir, who while denying having any knowledge of the bank account, voluntarily paid taxes on the peak balance based on the quantum provided by the department. The said admission was stated to be made to buy peace of mind and to avoid long drawn litigation and consequent adverse publicity to the departed soul. 2.3 During assessment proceedings, the legal heir was asked to submit the complete copy of the statement of bank account in HSBC, Geneva right from its inception till date. In the absence of non-availability, he was requested to fill up consent waiver form which was nothing but consent to HSBC Bank, Geneva to forward the requisite account details to the revenue authorities. The assessee denied having ownership of any bank account in HSBC, Geneva and submitted that he had never been authorized signatory or beneficial owner at any time of the alleged account. Resultantly peak balance of Rs.20.22 Crores was added u/s 69A of the Act, while framing the assessment. At the same time, the assessee was saddled with penalty of Rs.36,400/- u/s 272A(2)(c) for non-compliance of notice dated 19/12/2013 issued u/s 133(6) vide penalty order dated 30/12/2014.The same, upon 4 Assessment Year-2007-08 confirmation by Ld. first appellate authority, is under challenge before us. The grounds raised before us read as under: - 1. The Commissioner of Income Tax (Appeals)-2, Mumbai (hereinafter 'CIT(A)') erred in confirming the order passed by the AO u/s 272A (2)(c) of the I.T. Act. The Appellant submits that the penalty order passed by the AO is bad in law, contrary to the provision of the Act and deserves to be quashed. 2. (a) The CIT(A) erred in confirming penalty of Rs. 36,400/- u/s 272A(2)(c) of the I.T. Act being one hundred rupees for every day during which the alleged failure to comply with notice issued u/s 133(6) of the I.T. Act continues (i.e. from 31.12.2013 to 30.12.2014). (b) The CIT(A) erred in confirming the action of AO in stating that the Appellant has not complied with the notice issued u/s 133(6) of the I.T. Act. The Appellant submits that in the fact and circumstances of the case, he has duly complied with the notice issued u/s 133(6) of the I.T. Act and provided the information available with him; hence, penalty levied u/s 272A(2)(c) of the I.T. Act shall be deleted. (c) The CIT(A) erred in confirming the action of AO in invoking the provision of section 133(6) of the I.T. Act requesting the Appellant to sign and submit the consent waiver form. The Appellant submits that the consent waiver form neither constitute "information in relation to such points or matters" nor "statement of accounts and affairs"; hence, the same cannot be called for by invoking section 133(6) of the I.T. Act.” 2.4 The Ld. Authorized Representative, on the strength of documents placed in the paper-book assailed the penalty as confirmed by Ld. CIT(A). Reliance has been placed on the decision of Hon’ble Madras High Court rendered in CIT V/s Late Dr. K.C.G Verghese [TCA No. 854 of 2017 dated 20/02/2018] to submit the penalty was never invoked against the deceased assessee and therefore, the imposition of penalty on legal heir was not justified for mere non-signing of consent waiver form. On the other hand, Ld. DR supported the imposition of penalty. 3.1 We have carefully heard the rival submissions, perused relevant material on record & deliberated on judicial pronouncements as cited before us. We have also appreciated the statutory provisions as enumerated by us in the opening paragraphs.

5 Assessment Year-2007-08 3.2 From the perusal of documents, it transpires that certain information was sought by the revenue from legal heir with respect to Account No. 5090181079 vide notice u/s 131 dated 17/07/2013. The same was responded to by the authorized Representative vide letter dated 01/08/2013 wherein the legal heir while denying having any knowledge about the bank account, submitted that to buy peace of mind and to avoid litigation / adverse publicity, agreed to pay taxes voluntarily on peak balance based on quantum provided by the department. 3.3 Similar information was sought vide notice u/s 133(6) dated 19/12/2013 with respect to another account No. 5090186352 wherein the assessee was directed to submit the complete copy of statement of bank account right from its inception till date. In the alternative, the assessee was requested to fill up the consent waiver form. The submission of copy of the bank statement or duly filled consent waiver form was stated to be due compliance of the notice. However, vide response dated 31/12/2013, the following submissions were made by the authorized representative of Legal heir: - We again reiterate that we do not hold any account No. 5090186352 as alleged in your letter. As regards the request for signing the waiver form, it is submitted that your request is not as per the provisions of the Act, as our client is not in possession of any such accounts or documents, which is required to be submitted as per law.

The aforesaid response led Ld. AO to impose the impugned penalty for non-compliance of notice dated 19/12/2013 u/s 133(6). 3.4 We are of the considered opinion that alleged bank accounts were stated to be in the name of the deceased father. Therefore, the explanation

6 Assessment Year-2007-08 of the legal heir that he had no knowledge about the alleged bank accounts and the submissions that he was not in possession of any such bank statement as required by the revenue authorities, could not be held to be without any basis. The explanation furnished by the legal heir vide its earlier reply dated 01/08/2013 with respect to Bank Account No.5090181079 were duly accepted by the revenue and no penalty proceedings were initiated against those submissions. However, similar submissions advanced with respect to Account No. 5090186352 were disbelieved and it was alleged that the legal heir failed to comply with notice u/s 133(6) and hence, liable for penalty u/s 272A(2)(c). It is observed that the legal heir had duly replied to notice u/s 133(6) and explained its position with respect to allegations made by the revenue. Nothing on record would establish that the said information was ever in the possession of legal representative and he refused to part with the same. Further, the consent waiver form, in our opinion, could not be termed as information or statements of account and affairs within the meaning of Section 133(6) of the Act, the non-compliance of which is the primary ingredient to invoke the penal provisions u/s 272A(2)(c). The cited decision of Hon’ble Madras High Court would not have much relevance since it has been rendered in the context of Section 271(1)(c) and do not throw much light on the issue in hand. 3.5 Nevertheless, on the facts and circumstances, we are convinced with other arguments advanced by Ld. AR and inclined to delete the impugned penalty. We order so.

7 Assessment Year-2007-08 4. In the result, the appeal stands allowed.

Order pronounced in the open court on 30th July, 2019. (Sandeep Gosain) (Manoj Kumar Aggarwal) "ाियक सद" / Judicial Member लेखा सद" / Accountant Member

मुंबई Mumbai; िदनांकDated : 30/07/2019 Sr.PS:-Jaisy Varghese आदेश की "ितिलिप अ"ेिषत/Copy of the Order forwarded to : अपीलाथ"/ The Appellant 1. ""थ"/ The Respondent 2. आयकरआयु"(अपील) / The CIT(A) 3. आयकरआयु"/ CIT– concerned 4. िवभागीय"ितिनिध, आयकरअपीलीयअिधकरण, मुंबई/ DR, ITAT, Mumbai 5. गाड"फाईल / Guard File 6. आदेशानुसार/ BY ORDER,

उप/सहायकपंजीकार (Dy./Asstt.