9911796707
TMI Blog2022 (10) TMI 118X X X X Extracts X X X X X X X X Extracts X X X X ..... nd in law ,the Ld. CIT(A) erred in deleting the penalty of Rs.4,85,51,154/~ under section 271(l)(c) of the Act without appreciating that the proviso to section 275(1 )(a),inserted w.e.f.1.6.2003,mandates that the assessing officer shall pass the order imposing the penalty within one year from the end of the financial year in which such order of Ld.CIT(A) is received in the office of Pr.CIT." 3) "On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in quashing the order passed under section 271(l)(c) of the Act without appreciating that the facts of the case as referred to in the case law cited (65 taxmann.com 293) are totally different from the facts in the case of the assessee." Further, the assessee has filed additional ground in the C.O. challenging the validity of notice issued u/sec274 r.w.s 271(1)(c) of the Act. The Ld.AR made submissions on the legal ground of appeal and the Ld.DR has no serious objections. Accordingly the additional ground of appeal is admitted. 2. The brief facts of the case that the assessee company is engaged in manufacturing of transformers and lubricating oils and generation of electricity. The assessee has filed retur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 271(1)C of the Act dated 31.03.2018. 4. Aggrieved by the penalty order, the assessee has filed an appeal with the CIT(A), whereas, the Ld. CIT(A) considered the grounds of appeal, findings of the AO in scrutiny assessment, submissions of the assessee and dealt on the provisions under Section 271(1)C of the Act and judicial decisions and has deleted the penalty and observed at page 3 Para 4 to 7.1 of the order read as under: 4. Brief facts of the case: 4.1. The appellant filed its return of income for the A.Y. 2008-09 on 29.09.2008 declaring total income of Rs. 54,96,03,403/-. In this case, an order under section 143(3) dated 23.12.2010 was passed. In the assessment order, the AO made certain additions and initiated penalty proceedings under section 271(1) (c) of the Act. 4.2. On appeal, the CIT(A) confirmed the additions made by the AO. Aggrieved by the order of CIT(A), the appellant filed an appeal before the Hon'ble ITAT (ITA No, 867/Mum/2014). The appeal by the appellant against the order of the CIT(A) is still pending before the ITAT. 4.3. Meanwhile, the AO passed an order dated 19.03.2015 u/s 271(l)(c) holding that the appellant had concealed income to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was served upon assessee September 1965 and, therefore, the period of limitation of four years asstipulated under Section 153 (2) fa) of the Income Tax Act, 1961 then in force, expired on 31.3.1970. The assessment order came to be passed on 18.3.1970. 4. Insofar as second question is concerned, he points out that the Reference was necessitated in the light of argument advanced before the ITAT by the respective counsel or assessee's representatives. He invited our attention to the finding of the Tribunal that clause (c) of Section 271 (1) relates to the various defaults as also "concealment of income", the use of word "etc" becomes redundant. The Tribunal has further considered whether the use of the disjunctive "or" in the notices or communications issued by the Department gives rise to an ambiguity. He, therefore, states that altogether different complexion is now sought to be placed on question no. 2, as referred by pointing out various precedents which deal with technical aspects like recording a satisfaction on concealment etc. He urges that in present matter, ITAT has correctly found that if argument of assessee is accepted, it would lead to absurdity. He also by way of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -assessment dated 18.3.1970. We find that the provisions of Section 153 (2) at the relevant time prescribed limitation of four years from the end of assessment year in which notice under Section 148 of the Income Tax Act, 1961 is served upon assessee. Here, though notice is dated 25.1.1965, admittedly, it is served on assessee in September 1965 i.e. in financial year 1965-66 which expired on 31.3.1966. The assessment year for the purposes of Section 153 (2) (a) in present facts, therefore, shall be 1965-66 only and the order has been passed on 18.3.1970 i.e. before 31.3.1970. It is, therefore, within the stipulated time limit of four years. As such, it cannot be said that it is barred by limitation. Question No. (1) is answered accordingly in the negative i.e. in favour of the Department. 9. The provisions of Section 275 (1} (a) of the Act need to be looked into for considering the answer to second question. It is provided that no order imposing a penalty shall be passed where the assessment order is subject to appeal to the Commissioner (Appeals) or to further appeal to the Appellate Tribunal, after the expiry of period of two years from the end of financial year in which the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... argument as advanced. However, we note that learned counsel for the Department has attempted to show that as penalty order was passed for several years, concealment in one of the assessment years has been referred to by way of illustration. He submitted that as finding of concealment was maintained by 1st Appellate Authority on 2.3.1971 and was only partly set aside by ITAT on 26.3.1974, contention that penalty order does not specifically record any finding about concealment, is misconceived. 13.The language of Section 275 (1) (a) noted supra clearly shows that the order imposing penalty cannot be passed if the appeal against basic order of assessment is pending before the Competent superior Authority. Here, on 24.2.1972 though 1st Appellate Authority had disposed of the appeal, further appeal of assessee before the ITAT was very much pending. The order imposing penalty, therefore, appears to be premature and, therefore, illegal and without Jurisdiction. The notices for initiation of those proceedings are, dated 12.1.1972, 3.2.1972 and 27.9.1972 i.e. during the pendency of appeal before the ITAT. Essential ingredients of Section 275 (1) are clearly not in contemplation of notice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erused the materials on record. Prima facie, the Ld.AR contentions are that the Notice u/sec 274 r.w.s.271 of the Act issued by the Assessing officer is defective, as it does not mention whether the penalty is levied for concealment of particulars of income or furnishing inaccurate particulars of income. The Ld. AR has filed the submissions and demonstrated the copy of Notice. Whereas, the Ld.DR contentions are that the CIT(A) has erred in deleting the penalty and the Ld. AR has brought to the knowledge of the Honble Tribunal, the decision of coordinate bench of the Honble Tribunal in assessee own case deleting quantum additions in ITA No. 867/M/2014 A.Y. 2008- 09 dated 24.06.2002 observed at page 17 para 18 of the order read as under: 18. Therefore, in the aforesaid facts and circumstance, we find that the AO had erred in denying the claim of deduction u/s 80IA of the Act for A.Y. 2008-09 and likewise the Ld. CIT(A) also erred in denying the claim of the assessee. Therefore, we are inclined to allow the claim of the assessee u/s 80IA of the Act and direct the AO to allow the claim. Ground No.1 is allowed. 7. Considering the facts that the Hon'ble Tribunal has deleted the additi ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
