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Income Tax Appellate Tribunal, “K” BENCH, MUMBAI
Before: SHRI SHAMIM YAHYA, AM & SHRI RAVISH SOOD, JM
सुनवाई क� तार�ख / : 11.04.2018 Date of Hearing घोषणा क� तार�ख / : 02.05.2018 Date of Pronouncement आदेश / O R D E R Per Shamim Yahya, A. M.: This appeal by the assessee is directed against the order by the Commissioner of Income Tax (Appeals) dated 01.10.2012, wherein the ld. Commissioner of Income Tax (Appeals) has confirmed the levy of penalty u/s. 271(1)(c) of the Income Tax Act, 1961 amounting to Rs.4,20,701/-.
The grounds of appeal read as under:
M/s. Daichi Choukisen Kaisha 1. The order of the Commissioner of Income-tax (Appeals) is contrary to law and facts of the case. 2.1. The Commissioner (Appeals) erred in dismissing the appeal and confirming the levy of penalty under section 271(1) (c).of the Income-tax Act, 1961. 2.2 The Commissioner (Appeals) failed to note that the income assessed is the same as the one declared under section 172 and therefore there is no scope to invoke the provisions of section 271(l)(c). 2.3 The Commissioner (Appeals) failed to appreciate that full particulars of all that is necessary for computation of income under section 44B were furnished and a bonafide claim for relief for DTA made and therefore there is no inaccurate particulars of income or concealment within the meaning of section 271(l)(c) warranting a penalty. 2.4 The Commissioner (Appeals) failed to appreciate that Article 8 of the DTAA between Indian and Japan squarely applies and there is no PE for the Non Resident shipping Company in India and therefore penal provisions are not attracted merely because the claim for DTA relief was withdrawn because some particulars could not be ascertained and furnished. 2.5. The Commissioner (Appeals) failed to appreciate that a bonafide claim which was withdrawn cannot lead to levy of penalty when all available particulars were filed and no tax was sought to be avoided as the payment made under section 172 and the tax due under section 44B are one and the same. 2.6. The Commissioner (Appeals) erred in stating that the Appellant failed to substantiate the claim for DTA relief while substantial proof were furnished regarding the registration for the ship, plying in International waters etc,, and similar relief had been claimed and allowed in earlier and subsequent years and there is no change of fact or law. 2.7, The Commissioner (Appeals) failed to note that there is no material with the Assessing Officer to hold that effective management was in India or any other adverse fact brought to our notice and therefore failure to prove the negative cannot lead to penalty.
The ld. Counsel of the assessee has also raised an additional ground and requested for the admission of the same which reads as under:
On facts and circumstances of the case, the order of penalty u/s 271(l)(c) of the Act is bad in law and void ab initio, as the notice issued u/s 274 r.w.s. 271 is not in accordance with law. From the notice, it is not discernible as to why penalty is initiated, whether the penalty is initiated for furnishing of inaccurate particulars of income or for concealment of income, etc. Consequently, the penalty proceedings are wholly unsustainable in law and void ab initio, and the penalty deserves to be cancelled. Request for admission
M/s. Daichi Choukisen Kaisha The above grounds challenges the basic jurisdiction and validity of the notice issued u/s 274 of the Income Tax Act as well as penalty order passed under section 271(l)(c) of the Act. A prayer is therefore made to entertain the above ground apart from the grounds raised in Form 36 in appeal before your Honours.
As regards the admissibility of the additional ground, we have heard both the counsel and perused the records. We find the additional ground goes to the root of the matter and on the anvil of the Hon’ble Apex Court decision in the case of NTPC, we admit the additional ground.
Further upon careful consideration, we note that this ground was never raised before the ld. Commissioner of Income Tax (Appeals) nor the same was ever raised at any time before the Assessing Officer in the penalty proceedings. Hence, in our considered opinion, the interest of justice will be served if the additional ground so raised is remitted to the file of the ld. Commissioner of Income Tax (Appeals). The ld. Commissioner of Income Tax (Appeals) is directed to consider the additional ground and pass appropriate order on the ground raised after giving the assessee an opportunity of being heard.
Since we have already remitted the additional ground which goes to the root of the matter, we are not considering the merits of the order passed by the ld. Commissioner of Income Tax (Appeals). After the order of the ld. Commissioner of Income Tax (Appeals) is complete pursuant to our remitting the additional ground as above, it will be open to the parties to raise the ground as deemed necessary.
Both the counsel fairly agreed to the above proposition.
M/s. Daichi Choukisen Kaisha 8. In the result, this appeal filed by the assessee stands allowed for statistical purposes. Order pronounced in the open court on 02.05.2018
Sd/- Sd/- (Ravish Sood) (Shamim Yahya) �या�यक सद�य / Judicial Member लेखा सद�य / Accountant Member मुंबई Mumbai; �दनांक Dated : 02.05.2018 व.�न.स./Roshani, Sr. PS आदेश क� ��त�ल�प अ�े�षत/Copy of the Order forwarded to : अपीलाथ� / The Appellant 1. ��यथ� / The Respondent 2. आयकर आयु�त(अपील) / The CIT(A) 3. आयकर आयु�त / CIT - concerned 4. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, मुंबई / DR, ITAT, Mumbai 5. गाड� फाईल / Guard File 6. आदेशानुसार/ BY ORDER,