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Income Tax Appellate Tribunal, DELHI BENCH ‘D’, NEW DELHI
ORDER
Per N. K. Saini, AM:
This is an appeal by the department against the order dated 25.09.2013 of ld. CIT(A), Rohtak.
Following grounds have been raised in this appeal: “1. On the facts and circumstances of the case, CIT(A) has erred in law and facts in deleting the penalty u/s 272B of the I.Tax Act amounting to Rs. 87,20,000/- without any cogent reason.
2. On the facts and circumstances of-the case Ld. CIT(A) has erred in law and facts by deleting the penalty ignoring the fact of the submission made by the assessee that there was no reasonable cause for not complying with the provisions of the Act in time.
2 L. T. Foods 3. On the facts and in that circumstances of the case the Ld. CIT(A), has erred in law and facts in deleting the penalty u/s 272B of the I.Tax Act ignoring the facts that the assessee PR has quoted invalid PAN in violation of sub-section (5B) of section 139A of the I.Tax Act. 4. The appellant craves leave to add or amend any grounds of appeal before the appeal is heard.”
3. Facts of the case in brief are that the AO levied the impugned penalty by observing that there was failure on the part of the assessee to make appropriate compliance of provisions of Section 139A of the Income Tax Act, 1961 (hereinafter referred to as the Act) and that in as many as 872 cases invalid PAN of the deductees in its e-TDS return have been furnished.
Being aggrieved the assessee carried the matter to the ld. CIT(A) who deleted the penalty by observing in para 5 of the impugned order as under: “5. I have considered the issue and the written submissions produced by the AR of the appellant. From the facts, it is evident that the appellant filed TDS correction statement immediately on receipt of show cause notice generated by the System and a copy of acknowledgement was sent to the AO. The appellant received the final show cause notice of penalty beyond the specified date of compliance. Since the invalid / missing PANs have been made good by filing 3 L. T. Foods correction statements well before the issue of final penalty notice, the penalty is cancelled in view of the case law relied upon by the appellant the grounds of appeal
are allowed. Since the facts for other appeals are similar, the penalty imposed in these appeals is also cancelled.”
5. Now the department is in appeal. The ld. DR strongly supported the order of the AO dated 12.03.2012.
In his rival submissions the ld. Counsel for the assessee submitted that an identical issue having similar facts was a subject matter of the departmental appeal in for the assessment year 2010-11 wherein vide order dated 09.03.2016, the departmental appeal was dismissed and the issue was decided in favour of the assessee (copy of the said order was furnished which is placed on record).
We have considered the submissions of both the parties and perused the material available on the record. It is noticed that an identical issue having similar facts has already been adjudicated by this bench of the Tribunal in assessee’s own case for the aforesaid referred to order dated 09.03.2016 in wherein the relevant findings have been given vide paras 3 to 5 which read as under: “3. Having carefully examined the orders of the lower authorities in the light of the rival submissions, we find that the assessee has 4 L. T. Foods placed all the relevant evidence in support of the explanation that the PAN numbers were furnished on the basis of the information received from the deductees and moreover the income of the deductees were not taxable, therefore, the assessee was not required to deduct TDS and in respect of Shri. Karan Mankotia, TDS was deducted and paid in time. Therefore, there was no loss to the Revenue. However, the assessee has furnished correct statement. We find that the learned ''Commissioner of Income Tax (Appeals) has appreciated the explanations furnished by the assessee and rightly deleted the penalty. 4. We have also carefully examined the judgment of the Hon'ble Punjab & Haryana High Court in the case of Commissioner of Income Tax (TDS) vs. Superintendent of Police (supra) and we find that under similar circumstances, the Hon'ble High Court has held that penalty under section 272B of the Act should not be levied. The relevant observations of the Hon'ble High Court are as under:- "The Tribunal had come to the conclusion that there was sufficient cause on the part of the respondent while quoting PA of the deductees and as such no penalty was leviable. The tax was deducted and deposited in time In the Government Treasury, The error was due to wrong quoting of PAN by the deductees to the assessee. The assessee had rectified the mistake by furnishing the correct PAN as soon as it came to its notice. The revised PAN and the revised statement were accordingly filed. Following findings recorded by the Tribunal may be read:- "6. In the instant case, the only question before us is whether there was reasonable cause for alleged failure on the part of the assessee. In the instant case, the ITO(TDS) while going through the quarterly return in Form No.26Q, filed by the assessee noted that it has omitted to quote PAN/had quoted invalid PAN in 196 cases, As regards the reasonable cause, it was pleaded on behalf of the assessee that TDS was deducted and deposited in time In government Treasury. The default is only with regard to 5 L. T. Foods the wrong quoting of PAN of 196 of the deductees, such deductees quoted wrong PAN. However, correct PAN was given as soon as default was brought to the notice of the assessee, In this case, the CIT(A) has categorically observed that the assessee deducted TDS correctly and revised PAN and filed the revised statement on form No,26G, hence there was sufficient compliance of the provisions of section 139A. There is no dispute that the assessee quoted invalid PAN for 196 deductees which was corrected on out by ITO(TDS). In the instant case, failure to quote occurred as the concerned depositor had misquoted PAN. There is also no dispute that the PAN was corrected after ascertaining the same from the respective deductees."
5. The finding of the CIT(A) was upheld by the Tribunal with the following observations:- "7. In the above case, the Tribunal held that cumulative analysis of Section 139A and Rules 114B to 114D shows that an obligation to quote PAN/GIR number or to file Form No, 60 is that of customer and not that of the bank. Considering the entire facts and circumstances of the present case, and also keeping in view the decision of ITAT, Ahmadabad "D" Bench in the case of Financial Cooperative Bank Limited v. ITO, Ward 2(3), Surat (supra), we hold that there was reasonable cause of the default, if any committed by the assesses and hence no penalty under section 273B of the Act is leviable. In our view the learned CIT(A) has correctly appreciated the facts of the present case as well as settled legal position and therefore, we do not find any valid ground in interfering with the order of CIT(A). Consequently, appeal filed by the revenue is devoid of any merit and deserves to be dismissed,"
6. Learned counsel for the appellant was unable to show that the findings recorded by the CIT(A) as well as the Tribunal are erroneous in any manner, It was urged that there was no reasonable cause on the part of the assessee to furnish inaccurate PAN in Form 24Q.
6 L. T. Foods 7. On appreciation of the entire matter/ CIT(A) and the Tribunal examined the explanation of the assessee and came to the conclusion that there was sufficient cause shown which would be a question of fact in the given facts and circumstances. Once that was so, there is no substance in the argument raised by the learned counsel for the appellant.
8. Finding no merit in the appeal, the same is dismissed.”
Under these circumstances, we are of the view that penalty cannot be levied under section 272B of the Act. We, therefore, find no justification to interfere with the order of the learned Commissioner of Income Tax(Appeals), who has rightly deleted the penalty levied under section 272B of the Act.”
So, respectfully following the aforesaid referred to order dated 09.03.2016 in for the assessment year 2010-11 in assessee’s own case. We do not see any merit in this appeal of the department.
In the result, the appeal of the department is dismissed. (Order Pronounced in the Court on 28/11/2016)