Cabochon Arts P. Ltd, Mumbai vs Assessee
- CitationITA.No.5952/Mum/2013,िनधा
Ratio decidendi
The rule this decision rests on
Where an assessee has in fact appeared before the Assessing Officer in response to a notice under section 142(1), and the assessment is completed under section 143(3) rather than under section 144 with the record showing the assessee's representatives attended, a penalty under section 271(1)(b) for non-compliance with that notice cannot be sustained, the subsequent compliance being treated as good compliance in the assessment proceedings. Where the Assessing Officer's order sheet fails to record the assessee's attendance but the assessee's contemporaneous letter asserts that its representatives were kept waiting and were not admitted, and the record otherwise shows the assessee appearing before the Assessing Officer from time to time, the Tribunal may accept the assessee's account of attendance and find no default warranting penalty under section 271(1)(b).
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
आयकर अपीलीय अिधकरण, "सी" खंडपीठ मुंबई INCOME TAX APPELLATE TRIBUNAL,MUMBAI "C" BENCH सव ौी राजे ि लेखा सदःय एवं संजय गग याियक सदःय के सम"
Before S/Sh. Rajendra,Accountant Member & Sanjay Garg,Judicial Member आयकर अपील सं/.ITA.No.5952/Mum/2013,िनधा िनधा रण वष /AY.2009-10 M/s Cabochon Arts Pvt. Ltd. बनाम DCIT, Central Circle-11, G-2B, Nariman Bhavan, Ground Mumbai.
Floor, nariman Point, Mumbai-21 Vs. PAN:AABCC4288 आयकर अपील सं/.ITA.No.5954/Mum/2013, िनधा रण वष /AY.2009-10 M/s Osian's Art Fund, बनाम DCIT, Central Circle-11, G-2B, Nariman Bhavan, Ground Mumbai.
Floor, nariman Point, Mumbai-21 Vs. PAN:AAATO1513E आयकर अपील सं/.ITA.No.5958/Mum/2013, िनधा रण वष /AY.2009-10 M/s Oseta Investments Trustee Co. बनाम DCIT, Central Circle-11, Pvt. Ltd., G-2B, Nariman Bhavan, Mumbai.
Gr.Floor,nariman Point, Mumbai-21 Vs. PAN:AAACO7984N (अपीलाथ& /Assessee) (ू(यथ& / Respondent) िनधा )रती ओर से/Assessee by :Shri Shekhar Gupta राजःव क, ओर से/ Revenue by :Shri Neil Philip सुनवाई क, तार-ख/ Date of Hearing : 19-02-2015 घोषणा क, तार-ख / Date of Pronouncement : 19-02-2015 आयकर अिधिनयम, अिधिनयम 1961क, धारा 254(254(1)के अ तग त आदे श Order u/s.254(1)of the Income-tax Act,1961(Act) Per Bench, खंडपीठ के अनुसार:ार
Challenging the orders of the CIT(A)-37,Mumbai,Assessees have raised identical Grounds of Appeal for the above mentioned Assessment Year(AY.) in all the group cases:
"1.The learned Commissioner of Income Tax (Appeals) has erred in law and on the facts of the case in sustaining the penalty u/ s. 271(1)(b) Rs. 10,000/-.
2.The assessee company craves leave to add, alter or amend the above ground of appeal."
ITA/5952/Mum/2013,AY.2009-10:
2.In this case notice u/s 142(1) was issued by the Assessing Officer (AO) fixing the hearing on 05. 12.2011.As per the AO,nobody appeared in compliance of the notice. He initiated penalty proceedings as per the provisions of section 271(1)(b) r.w.s. 274 of the Act. A show-cause notice letter,dated 11.06.2012,was issued to the assessee asking it as to why the penalty should not be levied,amounting to Rs. 10,000/-,for alleged default committed by it.The assessee filed its reply vide letter dated 18.06.2012.After considering the same,he held that reason given by the assessee was not acceptable and levied a penalty of Rs. 10,000/-.
3.Aggrieved by the order of the AO the assessee preferred an appeal before the First Appellate Authority(FAA). Before him,a copy of the appellate order in respect of similar penalty levied by the AO on 03.10.2012 was filed.It was submitted before him that his predecessor had deleted the
2 ITA Nos. 5952, 5954 & 5958/Mum/2013 M/s.Cabochon Arts Pvt. Ltd.
penalty under the similar circumstances relying upon the order of the Akhil Bhartiya Prathmik Shikshak Sangh Bhawan Trust(115TTJ419) of the Delhi Bench.After considering the penalty order and the submission of the assessee,the FAA held that the default committed by the assessee was 3rd default,that despite penalty levied for earlier defaults it did not comply with the directions of the AO,that no reasonable cause was shown by the assessee for committing default.Finally,he upheld the order of the A.O.
4.Before us,Authorised Representative(AR)stated that the assessee had appeared before the AO whenever called,that he did not mark the presence of the assessee in the order sheet,that the assessee approached the Addl.CIT in that regard,that after his intervention only the AO marked the presence of the assessee,that there was no default on part of the assessee.He referred to the page no.2 of the paper book.He relied upon the order of the Akhil Bhartiya Prathmik Shikshak Sangh Bhawan Trust(supra).Departmental Representative (DR) supported the order of the FAA and stated that the assessee did not appear on three occasions.
5.We have heard the rival submissions and perused the material before us.We find that the AO had levied penalty u/s.271(1)(b)of the Act for non appearance before him,that the assessee had, vide its letter dated 18.06.2012,specifically mentioned that its representatives were made to wait outside the office of the AO,that the Addl.CIT had to intervene in the matter,that the AO had not contravened the assertion made by the assessee,that the FAA has not considered that vital issue while deciding the appeal,that in the assessment order the AO has mentioned that the AR of the assessee has appeared before him time to time,that the assessed income is same as the returned income.As the assessee had appeared before the AO,so,there was no justification for levy of penalty u/s.271(1)(b) of the Act.We also find that the predecessor of the FAA had deleted the penalty levied by the AO u/s. 271(1)(b) of the Act.Secondly,in the matter of Akhil Bhartiya Prathmik Shikshak Sangh Bhawan Trust (supra),Tribunal has been held as under :
"Where assessee had not complied with notice under section 142(1) but assessment order was passed under section 143(3) and not under section 144, that meant that subsequent compliance in assessment proceedings was considered as good compliance and defaults committed earlier were ignored by Assessing Officer and, therefore levy of penalty under section 271(1 )(b) was not justified.
Respecfully,following the above order of the Delhi Tribunal and considering the facts and circumstances of the case,we are deciding the effective ground of appeal in favour of the assessee.
ITA/5954 &5958/Mum/2013,AY.2009-10:
6.The facts and circumstances of both the group cases are identical to the facts of the earlier assessee. Following our order at paragraph no.5,we decide the effective ground of appeal in favour of the assessee.
As a result,appeals filed by all the three assessees stand allowed. फलतः तीन9 िनधा )रितय9 :ारा दा;खल क, ग< अपील= मंजूर क, जाती ह@ .
Sd/- Sd/-
(संजय गग /SANJAY GARG) (राजे ि / RAJENDRA) याियक सदःय / JUDICIAL MEMBER लेखा सदःय / ACCOUNTANT MEMBER मुंबई/Mumbai,Aदनांक/Date: 19.02.2015 SK 3 ITA Nos. 5952, 5954 & 5958/Mum/2013 M/s.Cabochon Arts Pvt. Ltd.
आदे श क, ूितिलBप अमेBषत/Copy षत of the Order forwarded to : 1. Assessee /अपीलाथ& 2. Respondent /ू(यथ&
3.The concerned CIT(A)/संबD अपीलीय आयकर आयुE, 4.The concerned CIT /संबD आयकर आयुE
5. DR "C" Bench, ITAT, Mumbai /Bवभागीय ूितिनिध सी खंडपीठ,आ.अ. याया.मुब ं ई
6. Guard File/गाड फाईल स(याBपत ूित //True Copy// आदे शानुसार/ BY ORDER, उप/सहायक पंजीकार Dy./Asst. Registrar आयकर अपीलीय अिधकरण, मुंबई /ITAT, Mumbai
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