TMI Blog1996 (5) TMI 105X X X X Extracts X X X X X X X X Extracts X X X X ..... ovember, 1990, duly served to produce the books of account and other relevant documents to verify the purchases. The assessee again failed to produce the same on the said date. The assessee was issued show-cause notice dated 26-11-1990, requiring him to show cause why penalty should not be imposed. No reply has been received. It is clear that assessee is deliberately and intentionally not complying with the provisions of section 131 issued on 11-10-1990 fixing the case for 16-10-1990 and again fixing the case for 12-11-1990. As the default committed is intentional and deliberate I impose penalty of Rs. 5,000 for the said default. " Aggrieved by the said penalty, the assessee preferred an appeal before the CIT(A). 3. Before the CIT(A), the assessee's counsel contended that the DC issued a summon on 4-9-1990 under section 131 to produce the pass book, account books, stock register and other relevant documents for the period from 1-4-1987 to 31-3-1989 to ascertain the purchases made by M/s Alpine Exports, New Delhi. The case was fixed for 10-9-1990. This notice was not served on the right person. It came late to the assessee's hands on or around 11-9-1990. Hence compliance could n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unt of M/s. Alpine Exports, T-18, Okhla Industrial Area, Phase-II, New Delhi as appearing in your books of account for assessment year 1989-90 starting from 1-7-1987 to 31-3-1989 (for 21 months). Kindly report all the purchases by M/s. Alpine Exports from 1st day of July 1987 to 31st March of 1989. Copy of summons under section 131 of the I.T. Act is enclosed. Furnished of above information will be treated as compliance to the summons.' The appellant has complied to the terms of this letter by furnishing the information as required in this letter along with the clarification regarding alleged sales to M/s. Alpine Exports. On 11-1-1990, the DCIT issued a show cause notice to the appellant indicating therein that there had been no compliance to summons an 10-9-1990 and 20-9-1990. On 11-10-1990 another summon under section 131 was issued fixing the case for 16-10-1990. In the said summon the appellant was required to produce the books of account, bank pass book, stock register and other relevant papers such as sales and purchase vouchers for the period from 1-7-1987 to 31-3-1989. The appellant claims that the Inspector had examined the accounts while serving the summons. However, fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e arguments of the assessee's counsel were to the following effect :---Summons issued fixing the case for hearing on 20-9-1990 can be seen at page 2 of the Paper Book filed. Along with the said summons, letter dated 11-9-1990 was also issued. The D.C. wrote in the said letter to the assessee to send copy of the account of A.E. as appearing in its books for the assessment year 1989-90 starting from 1-7-1987 to 31-3-1989 and report all the purchases made by A.E. from 1-7-1987 to 31-3-1989. In the second para of the said letter, it is mentioned as under :--- "Copy of the summons under section 131 of the I.T. Act is enclosed. Furnished of above information will be treated as compliance to the summons. On 20th September 1990, the assessee filed copy of the account of A.E. in its books for the period 1-4-1987 to 31-3-1990. It was further mentioned that the books of account were shown to the Inspector. It was also mentioned that it had sold 10 bales 40s Cambric Sita Laxmi to A.E. through broker Sushil. Photostat copy of the bill was enclosed. The assessee had given its GIR No. as GIR:B-398/DLI IV(7). Acknowledgement was obtained in receipt No. IP/90-91/7136 dated 20-9-1990. The assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e above documents and that the books of account had been examined by the Inspector concerned. This is the compliance of the summons fixing the hearing for 16-10-1990. The Inspector has no legal authority to examine the books unless authorised by the concerned ITO. It is improper on the part of the assessee to write on the letter dated 11-10-1990. Books of account have to be produced in response to the summons fixing the hearing for 16-10-1990. Fourth summons were issued fixing the case for 12-11-1990. The assessee did not face the D.C., but sent a letter dated 12-11-1990. Again, summons were issued fixing the hearings on 28-11-1990 and 17-12-1990. Show-cause notices dated 26-11-1990 and 13-12-1990 were also issued to the assessee. The assessee has not cared to comply with the several summons issued. However, the D.C. is lenient. He has imposed only one penalty. On 26-12-1990, the D.C. records in the order-sheet that Mr. Alok Shorewala, partner of M/s. Biharijee Exports attends and produces the books of account and bank statement and that the transaction with M/s. J.P. Agarwal, Prop. of A.E. is found correctly recorded. Under these circumstances, the levy of penalty of Rs. 5,000 is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 20-9-1990 sent copy of the account of the A.E. in the books of M/s. Vaish Cloth House. In All these cases, furnishing of copies of account of A.E. in their books was treated as compliance with the summons issued, by the A.O. The assessee before us, M/s. Biharijee Exports also sent a letter dated 20-9-1990 enclosing a copy of the account of A.E. in their books. But surprisingly, the D.C. was not satisfied that his summons were complied with. He issued another summons posting the case to 16-10-1990. In the said summons, he directed the assessee, M/s. Biharijee Exports to produce before him Bank Pass Book, books of account, stock register and other relevant papers like sales and purchase vouchers for the period 1-7-1987 to 31-3-1989. In the covering letter dated 11-10-1990 sent along with the summons it has been mentioned that the assessee intentionally omitted to attend and give evidence or produce the books of account or documents in response to the earlier summons fixing the hearing on 20-9-1990. In the said covering letter dated 11-9-1990, the assessee left a Note that copy of the account of A.E. in its books was already filed with the D.C. on 20-9-1990 itself and mentioned ..... X X X X Extracts X X X X X X X X Extracts X X X X
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