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Facts
The assessee filed an appeal against the order of the CIT(A) NFAC confirming a penalty levied under Section 271-D. The penalty was for AY 2017-2018 and was not initiated with the assessment order. The grounds of appeal question the confirmation of the penalty, the timing of its initiation, and whether the assessee was aware of the amendments to Section 269SS concerning specified persons. A key issue is that the CIT(A) allegedly dismissed the appeal without considering the assessee's detailed submissions due to a communication gap.
Held
The Tribunal held that the CIT(A) denying the assessee an opportunity to present its case by dismissing the appeal before considering detailed submissions violates the principles of natural justice. Therefore, the case is remanded back to the CIT(A) for a decision on merits after providing a due and adequate opportunity of hearing to the assessee.
Key Issues
Whether the CIT(A) erred in confirming the penalty under Section 271-D without affording the assessee adequate opportunity to present its case, thereby violating principles of natural justice.
Sections Cited
271-D, 269SS, 143(3), 115BBE, 143(1), 271AAC, 271E, 250
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Income Tax Appellate Tribunal, DIVISION BENCH, AMRITSAR
Before: SHRI UDAYAN DAS GUPTA & SHRI KRINWANT SAHAY
Assessment Year : 2017-18 Rohtash Monga,' The ACIT, Prop. Monga Jewellers, Circle, F.City, Punjab 152002 Ferozepur Wft^felFH./PAN NO: ADQPM0639Q HITT^/'Respondent 3141 cl l‘4f/ A p p e 11 a n t ( HybridHearing ) 3f(T Tt/Assessee by : Shri P.N. Arora, Advocate 'iM'WcfTl 3{R ■$/ Revenue by : Mrs. Neelam Sharma, Sr.DR ^HcfT^dT^WDate of Hearing 27.12.2024 u 11 cfrlcTT'^WDate of Pronouncement 3fT‘i^T/Order Per Krinwant Sahay, AM: Appeal in this case has been filed by the Assessee against the order dated 16.09.2023passed by Id. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi (NFAC). Grounds of appeal are as under: -
2. That whether the worthy CIT(A). NFAC is right in confirming 1. the penalty levied u/s 271-D for A.Y. 2017-2018 passed on dt. 16.9.2023 which was not initiated with the Assessment order passed 30.11.2019 by AO, Range-1. Ferozepur keeping in view the letter of offer surrender dt. 8.11.2011 in which it is written that surrender is subject to no penal action against the assessee, which was accepted by the survey party as veil as the A.O. who framed the assessment for A. O. 17-18, if wrong, then the penult orders may kindly be quashed. \ 286-Asr-2023 RohtahMonga,Ferozepur 2 That whether the worthy CIT(A), NFAC was right in 2. confirming the penalty orders passed of A.O viz., JT. CIT (A), Bhatinda Range -1, Bhatinda, as JT., CIT, Range-1, Bhatinda which was initiated the penalty proceedings 31.3.2022, and not with the assessment order which was passed 30.11.2019 u/s 143(3) of the I. T. Act, 1961 due the facts that penalty notice was issued : a) firstlySmtSneh Lata, secondly to Smt. Rita Bajaj b) c) thirdly to Sh. Rohtash Monga under section 271-D for the Asstt., year 2017-2018 for the offence u/s 269SS of the Income Tax Act 1961 on account of the amendment section 269SS in the definition of Specified person and Specified Advance against the Immoveable Property was amended w.e.f. 1.6.2015, to which neither the Smt. Sneh Lata nor Smt. Rita Bajaj nor Sh. Rohtash Monga was aware about the amendment of change of definition of specified person for receiving advance against the property. If wrong then penalty levied amounting to Rs.1,75,000/- may kindly be quashed. That whether the worthy CIT(A)NFAC is right while confirming the penalty levied u/s 271-D by Jt. CIT, Range-1 Bhatinda whereas no penalty proceedings was initiated for the Assessment Year 2017-2018 in the case of Sh. Rohtash Monga in which no penal Action was initiated except u/s 271AAC read with section 115BBE keeping in view the letter of offer submitted on 8.12.2016 to the Survey Party and accepted by survey party and as well as the then A.O. who framed the Assessment u/s 143(3) for the Assessment year 2017-2018 on 30.11.2019 and similarly AO has framed the Assessment u/s 143(1) for the Assessment Year 2018-2019 in both assessment years in which no penalty proceedings was initiated neither in the A.Y. 2017-2018 and 2018-2019 respectively, if wrong then the it is prayed that the penalty orders passed u/s 250 by the CIT(A), NFAC, u/s 271-D of the Income Tax Act, 1961 may kindly be quashed.
286-Asr-2023 RohtahMonga,Ferozepur 3 That whether the worthy Commissioner of Income Tax, (A) 4. NFAC is right in deciding the Jurisdiction to rely the Judgements relied upon by assessee of Supreme Court of India, Punjab and High Court and other High Courts as well as of ITAT of different Bench, which was rejected by Jt. CIT, Range-I, Bhatinda as well as by the CIT (A) NFAC on the plea cited as Under: ”As far as the judgements cited by the assessee in this submission are concerned, the same do not pertain to the Jurisdictional appellate authorities and are therefore not binding. " If, wrong, then the appeal of the assessee may kindly be accepted and the penalty orders may kindly be quashed. The assessee craves to add or amend any grounds of 5. appeal before the appeal is finally disposed of or any other relief may kindly be granted to which the court feel fit in the interest of law of natural justice. During the proceedings before us, the Id. Counsel for the Assessee 3. has filed written submissions which is reproduced as under: - Statement of facts in the case of Sh. Rohtash Monga Prop., M/S Monga Jewellers. That worthy CIT(A), NFAC issued notice u/s 250 vide No. ITBA AC/F//APL-1/2023-2024/1054733125(1) DATED 31.7.2023 for submission of reply on or before 4.8.2023. On account of appeal filed against the penalty order passed on 12.9.2022 by the Learned Jt. CIT, Range, Bhatinda u/s 271-D of I.T. Act, 1961, for the A.Y. 2017-2018. On 3.8.2023 before 4.8.2023 the assessee sought adjournment for 18.8.2023 and on 18.8.2023 when the assessee uploaded his written reply on the portal in response to this notice of appeal for penalty under section 271-D of the Income Tax Act, 1961. On the said i.e. 18.8.2023 the 286-Asr-2023 RohtahMonga,Ferozepur 4 assessee came to know that the Appeal filed against the penalty levied u/s 271-E has been dismissed on dt. 16.8.2023 bythe CIT(A) NFAC.
But the worthy CIT(A), NFAC, while dismissing the appeal of the assessee filed u/s 271-D, for the A.Y.2017-2018 on dated 16.9.2023 against the notice issued u/s 250 vide No. ITBA/NFAC/F//APL-1/2023-2024/1054733125(1) DATED 31.7.2023 without appreciating the facts submitted on 18.8.2023 through written submission. The Id. Counsel further argued that since the CIT(A) did not had the 4. opportunity of going through detailed submission filed by the Assessee before passing the order, therefore, the order passed by the Id. CIT(A) should be quashed. * The Id. DR relied on the order of the CIT(A). 5.
We have considered the findings given by the Id. CIT(A) in his appeal 6. order and we find that in compliance to notice issued u/s 250 of the Act by the CIT(A), NFAC dated 31.7.2023, the Assessee filed an applicationon 3.8.2023 requesting therein to adjourn the case till 18.8.2023 so that detailed submission can be filed. The Assessee did file a detailed submission on 18.8.2023 but because of some communication gap or technicalerror it seems the Id. CIT(A) had already dismissed the appeal against the penalty levied u/s 271A dated 16.8.2023 i.e. two days prior to the date requested bythe Assessee. Accordingly, we find that the Assessee couldnot get opportunity to bring its detailed submissions before passing an order by the 286-Asr-2023 RohtahMonga,Ferozepur 5 Id. CIT(A). In our view, it is against the element of natural justice where the Assessee has been denied tobring its case before the adjudicatingauthority. Whatever reason there is no denying that the very basic requirement ofnatural justice i.e. opportunity to the Assessee to bring its submissions to the notice of the CIT(A) has not been adhered to in this case. So, we are inclined to remand this case back to the CIT(A) to decide theissue afresh on merit, in accordance with law, on affording due and adequate opportunity of hearing to the Assessee. The Assessee, no doubt, shall cooperate in the fresh proceedings before the CIT(A).A11 pleas available under the law shall remain so available to the assessee. Ordered accordingly. The appeal of the Assessee is allowed for statistical purposes.
In the result, the appeal is allowed for statistical purposes.