THE SUB REGISTRAR vs. DIRECTOR OF INCOME TAX (I & CI),

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ITA 43/PAT/2016Status: DisposedITAT Patna12 March 2018AY 2014-154 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the appeal filed by the assessee was not maintainable before the ITAT directly. The reasoning was based on the consistent view taken by various benches of the Tribunal, including the ITAT Chandigarh in the case of Sub-Registrar, Tehsil Officer, Kumarsain Vs DIT(CIB) and the ITAT Jodhpur in the case of Sub Registrar, Post Padampur Vs DIT(I&CI). These decisions, supported by CBDT clarifications regarding Section 246A(1)(q), established that an appeal against an order levying penalty under Section 271FA must first be filed before the CIT(Appeals). The Tribunal found that the assessee should have filed an appeal before the CIT(Appeals) before approaching the ITAT. Consequently, the appeal was dismissed as not maintainable. No issue was expressly left undecided.

What were the facts?

The assessee, the Sub-Registrar, Sub Registry Office, Piro, Bhojpur, filed an appeal against an order dated 23.02.2016 passed by the Director of Income Tax (Investigation & Criminal Intelligence) (DIT(I&CI)), Patna. The appeal concerned a penalty levied under Section 271FA of the Income Tax Act, 1961, for failure to file the annual information report (AIR) within the prescribed time for the financial year 2013-14. The assessee had responded to the show-cause notice by stating that the AIR was filed on 15.04.2015 and enclosed a provisional receipt. However, the DIT(I&CI) was not satisfied and levied a penalty of Rs. 22,600/-. The assessee filed a direct appeal to the Income Tax Appellate Tribunal (ITAT), Patna Bench, against this penalty order. The Revenue was represented by the Sr. DR, while the assessee was absent and had not sought an adjournment.

What were the issues?

1. Whether the appeal filed by the assessee against the order of the DIT(I&CI) levying penalty under Section 271FA is maintainable before the Income Tax Appellate Tribunal (ITAT) directly, or if it should have been filed before the Commissioner of Income Tax (Appeals) (CIT(A)) first? (Question of law, turning on Section 246A(1)(q) of the Income Tax Act, 1961). Assessee's contentions: The judgment records no specific contentions from the assessee as they were absent. However, the fact that they filed a direct appeal implies an assertion of maintainability. Revenue's contentions: The Sr. DR supported the order of the DIT(I&CI). Implicitly, the Revenue contended that the appeal should not be before the ITAT directly, aligning with the cited precedents.

Which sections of the Income-tax Act were involved?

Section 271FA,Section 246A(1)(q)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PATNA BENCH, PATNA

Hearing: 12.03.2018Pronounced: 12.03.2018

Per_N. K. Saini, AM:

This is an appeal by the assessee against the order dated 23.02.2016 of DIT (1&CI), Patna.

2.

The grievance of the assessee in this appeal relates to the penalty levied u/s 271FA of the Income Tax, 1961 (hereinafter referred to as the Act).

3.

Facts of the case in brief are that the DIT(I&CI), Patna issued a notice dated 03.11.2015 to the Sub-Registrar, Sub Registry Office, Chatra (Assessee) requiring him to show cause as to why penalty u/s 271FA of the Act should not be levied for failure to file the annual information report within the prescribed time. In response, the assessee vide letter dated 23.11.2015 stated that the AIR for the financial year 2013-14 had been filed by the assessee on 15.04.2015 and enclosed the provisional receipt of AIR.

2 ITA No. 43/Pat./2016 Sub Registrar

However, the DIT(I&CI) was not satisfied from the reply of the assessee and levied the penalty of Rs.22,600/-.

4.

Now the assessee has filed the direct appeal. Nobody was present on behalf of the assessee neither any adjournment was sought. We, therefore, proceeded ex-parte. The Id. Sr. DR supported the order of the Id. DIT(I&CI).

5.

We have considered the submissions of Id. Sr. DR and perused the material available on the record. In the present case, it is an admitted fact that the appeal has been filed by the assessee against the order of the DIT(I&C]) directly to the ITAT and not to the CIT(Appeal).

6.

On a similar issue, various benches of the Tribunal has taken a consistent view that no direct appeal can be filed against the order of the DIT(I&CI). The Co-ordinate Bench at ITAT Chandigarh in the case of Sub-Registrar, Tehsil Officer, 1184, 1185, 1186 & 1189/Chd/2010 vide order dated 22.02.2011 held as under:

“5. We have heard the parties and considered the facts and materials on record. First of all, we have to decide whether the appellant can file an appeal before the Tribunal directly without filing of appeal before the CIT(Appeals). In this connection, learned counsel for the assessee brought to our notice that now the CBDT has clarified in F.No.279/M-31/2010-SO(ITJ) on this point. He also filed on record a copy of page No. 5 & 6 of the said Notification. We find that in the above Notification, the CBDT has clarified that u/s 246A(1)(q),

3 ITA No. 43/Pat./2016

Sub Registrar of the income-tax Act, the CIT(Appeals) has powers to dispose of any penalty levied u/s 271FA and that there is no legal bar on CIT(Appeals) passing an appeal order against penalty order passed by the DIT(CIB), who is equivalent to the rank of CIT(Appeals). It has also been mentioned in the above Circular that whether CIT(Appeals) and DIT(CIB) are equivalent in rank or not is an administrative issue and it has nothing to do with the fact that the CIT(Appeals) can hear an appeal filed against an order passed u/s 271FA of the Income Tax Act by Director of Income Tax (CIB).

Further it is clarified in the said Circular that u/s 246A(1)(q) 0 Income Tax Act, CIT(Appeals) has powers to hear an appeal filed against an order passed under Chapter XXI of the Income Tax Act, 1961. 6. In view of the above clarification given by the CBDT, in our considered opinion, the appellant should have filed an appeal before the CIT(Appeals) before filing an appeal directly before this Tribunal. In view of this position, we are dismissing all the four appeals filed by the appellant.”

7.

Similarly, the ITAT Jodhpur Bench in ITA No. 292/Jodh/2012 for the assessment year 2011-12 in the case of Sub Registrar, Post Padampur, Sriganganagar Vs DIT(I&CI), Jaipur Rajasthan vide order dated 03.10.2012 held as under:

“2.3 We have heard both the parties and perused the materials available on record. It is noticed that a similar issue has been adjudicated upon by the ITAT, Jodhpur Bench in the case of Sub-Registrar, Sri Dungargarh Vs. Director of Income Tax (CIB), Jaipur in ITA No. 560/JU/2009 relating to assessment year 2008-09 wherein vide order dated 3.5.2010, it has been held that no direct appeal lies before the ITAT in respect of order passed u/s 271FA of the Act and the relevant findings have been given in para 3 of the aforesaid order, which reads as under:-

4 ITA No. 43/Pat./2016

Sub Registrar “3. In catena of cases, this Tribunal had entertained a view that no direct appeal lies before the Appellate Tribunal against the order passed u/s 271FA of the Act. For this reason, the assessee’s appeal is liable to be dismissed. Accordingly, appeal is dismissed as announced in open court on 3.5.2010.”

2.

4 So, respectfully following the aforesaid referred to order dated 3.5.2010 of the ITAT Jodhpur Bench, Jodhpur in the case of Sub-Registrar, Sri Dungargarh Vs. Director of Income Tax (CIB), Jaipur in ITA No. 560/JU/2009, this Direct appeal of the assessee filed in the ITAT is dismissed considering the same as not maintainable.”

8.

So, respectfully following the aforesaid orders of the Co-ordinate Benches of the ITAT, the appeal filed by the assessee is dismissed considering

the same as not maintainable.

9.

In the result, the appeal of the assessee is dismissed.

(Order Pronounced in the Open Court on 12/03/2018) (Sudhanshu Srivastava) (N. K. Saini) JUDICIAL MEMBER ACCOUNTANT MEMBER

Dated: 12/03/2018 *Subodh*

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