Income Tax Appellate Tribunal - Delhi
M/S. C S Leasing Pvt. Ltd., Delhi vs Acit, New Delhi on 13 October, 2017
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCHES "B": DELHI
BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER
AND
SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER
ITA.No.6390, 6391 & 6392/Del./2014
Assessment Years 2005-06, 2006-07 & 2007-08
Smt. Chandrawati Gupta, The ACIT
A-1, C.C. Colony, Opp. R.P. Central Circle-12
Bagh, Delhi. vs., New Delhi.
PAN AEXPC2379F
(Appellant) (Respondent)
ITA.No.6405, 6406, 6407, 6408, 6409 & 6410 /Del./2014
Assessment Years 2005-06, 2006-07 & 2007-08
C S Leasing Pvt. Ltd., The ACIT
A-1, C.C. Colony, Opp. R.P. Central Circle-12
Bagh, Delhi. vs., New Delhi.
PAN AAEFC9884A
(Appellant) (Respondent)
For Assessee : Shri S.B. Gupta, FCA
For Revenue : Shri Subhash Verma, Sr. D.R.
Date of Hearing : 09.10.2017
Date of Pronouncement : 13.10.2017
ORDER
PER BENCH :
This order shall dispose of all the above appeals filed by two assessees on the identical facts.2
ITA.Nos.6390, 6391, 6392/D/2014 Smt. Chandravati Gupta, Delhi & ITA.Nos.6405, 6406, 6407, 6408, 6409 & 6410/D/2014 C S Leasing Pvt. Ltd., Delhi.
2. We have heard Learned Representatives of both the parties and perused the findings of the authorities below. The appeals are decided as under.
SMT. CHANDRAVATI GUPTA - ITA.Nos.6390, 6391 & 6392/Del./2014 :
3. The above three appeals by assessee are directed against the common order of the Ld. CIT(A)-XXXI, New Delhi, dated 29th August, 2014, challenging the levy of penalty under section 271(1)(b) of the I.T. Act, 1961, for the A.Ys. 2005-06, 2006-07, and 2007-08.
4. Briefly the facts of the case are that the A.O. issued notices under section 143(2)/142(1) of the Act, fixing the cases for hearing on 11th January, 2013 but none attended on that date. In the written submissions, the Ld. A.R. mentioned that the said notices had not been received by them till 11th January, 2013. Therefore, it is not mentioned as to when the notice was actually received by them and what action they took thereafter. The A.O. followed-up the non- compliance of the above said notice by issuing show cause notice for levying penalty under section 271(1)(b) of the Act on 28th March, 2013. But, no one attended. The assessees did not give reasons for 3 ITA.Nos.6390, 6391, 6392/D/2014 Smt. Chandravati Gupta, Delhi & ITA.Nos.6405, 6406, 6407, 6408, 6409 & 6410/D/2014 C S Leasing Pvt. Ltd., Delhi.
non-compliance. The A.O. issued another show cause notice on 5th August, 2013 fixing the case for hearing on 27th August, 2013. Again nobody attended in response to the notice. The Ld. A.R. stated that in the said show cause notice there is no mention of day of non- compliance and hence, show cause notice was an empty formality. The A.O. however, levied the penalty for failure to comply with the notice. The assessee submitted before the Ld. CIT(A) that Smt. Abha Gupta, daughter-in-law of the assessee was suffering from illness and had to be hospitalized on 11th January, 2013. Further, he submitted that Shri Satyaprakash Gupta, head of the family and husband of the assessee had to be hospitalized due to heart attack and therefore, there were non-compliance. The Ld. CIT(A) however, found that there was non-compliance and it being a time barring matter, the assessee should have cooperated with the A.O. The Ld. CIT(A) found that A.O. levied the penalty for seven years which in his opinion, would be harsh on the assessee. The Ld. CIT(A) confirmed the penalty for three years, out of seven assessment years and confirmed penalty for A.Ys. 2005-06, 2006-07 and 2007-2008 and for the rest of the A.Ys. 2008-2009 to 2011-2012, penalties have been 4 ITA.Nos.6390, 6391, 6392/D/2014 Smt. Chandravati Gupta, Delhi & ITA.Nos.6405, 6406, 6407, 6408, 6409 & 6410/D/2014 C S Leasing Pvt. Ltd., Delhi.
cancelled. Therefore, the assessee is in appeal for these three assessment years.
5. Learned Counsel for the Assessee submitted that in an identical case(of the group cases) of M/s. Macadam Road Makers P. Ltd., Delhi vs. ACIT, Central Circle-12, New Delhi, the ITAT-E Bench vide order dated 1st September, 2017 in ITA.Nos.6403 & 6404/Del./ 2014, cancelled the penalty. The order of the Tribunal in paras 4 to 9 are reproduced as under :
"4. The assessee submitted before the Ld. CIT(A) that Smt. Abha Gupta, daughter-in-law of the Principal Officer of the assessee company namely Mr. Satya Prakash Gupta has to be hospitalized on 11th January, 2013. Further, he submitted that Mr. Satya Prakash Gupta, Principal Officer of the assessee company had to be hospitalized due to heart-attack and therefore, there were non-compliance of the said notices. The Ld. CIT(A) however, noted that the assessee did not explain these facts before the A.O. The Ld. CIT(A) also noted that during assessment proceedings which are time barring in nature, the details required by the A.O. were not filed on time. In case details are filed at the last movement, the A.O. would be having no time to process the information received. The reasons given by the assessee did not explain the total non-compliance. The Ld. CIT(A) 5 ITA.Nos.6390, 6391, 6392/D/2014 Smt. Chandravati Gupta, Delhi & ITA.Nos.6405, 6406, 6407, 6408, 6409 & 6410/D/2014 C S Leasing Pvt. Ltd., Delhi.
however, noted that there is a merit in levying the penalty in spite of certain procedural deficiencies pointed out by the assessee. However, levying penalty for three years, in the view of the Ld. CIT(A), would be harsh on the assessee. The Ld. CIT(A), accordingly, confirmed the levy of penalty for A.Y. 2009-2010 under appeal but penalty for A.Ys. 2010-2011 and 2011-2012 were deleted. The common order is passed for all these three years.
5. In ITA.No.6403/Del./2014 (A.Y. 2009-2010), the Ld. CIT(A) noted similar facts that penalty was imposed for non- compliance of the statutory notices issued on 9th October, 2012. The assessee submitted in the written submissions that Mrs. Anju Gupta, daughter-in-law of the Principal Officer of the assessee-company was suffering from severe disease and had to be hospitalized on 6th October, 2012. Thereafter, on 9th October, 2012 Shri Satya Prakash Gupta, Principal Officer of the assessee-company himself suffered from heart-attack and had to be hospitalized. The whole family were disturbed. Therefore, there were no compliance. The Ld. CIT(A) given the same finding as have been given in ITA.No.6404/Del./2014 and confirmed the levy of penalty for assessment year under appeal i.e., 2009- 2010, however, deleted the similar penalty levied for A.Ys. 2010- 2011 and 2011-2012 in the common order.6
ITA.Nos.6390, 6391, 6392/D/2014 Smt. Chandravati Gupta, Delhi & ITA.Nos.6405, 6406, 6407, 6408, 6409 & 6410/D/2014 C S Leasing Pvt. Ltd., Delhi.
6. Learned Counsel for the Assessee reiterated the submissions made before the Ld. CIT(A) and submitted that the reasons given by the assessee for non-compliance have not been disputed by the Ld. CIT(A) which clearly disclosed reasonable cause for failure to comply with the notices. Learned Counsel for the Assessee also submitted that Ld. CIT(A) decided the appeals for three years each in both the impugned orders and on the same reasoning and explanation, the Ld. CIT(A), cancelled the penalty for two years. Meaning thereby, the explanation offered by the assessee has been accepted that no penalty is leviable. He has relied upon the common order of ITAT, SMC Bench, in the case of Smt. Usha Gupta etc., vs. ACIT, Central Circle-12, New Delhi in ITA.Nos.6368 & 6371/Del./ 2014 etc., decided on 4th November, 2015 in which the A.O. levied the penalty for seven assessment years under section 271(1)(b) of the I.T. Act and the Ld. CIT(A), deleted the penalty for four years. Considering the explanation of assessee to be proper, the Tribunal cancelled the penalty for the remaining years as well. He has submitted that the similar explanation for Mrs. Anju Gupta and Shri Satya Prakash Gupta have been considered for non-compliance in their cases on 9th October, 2012. Copy of the order is placed on record. Similar order of the Tribunal in the case of Saraswati Resorts Pvt. Ltd., Delhi vs. ACIT, Central Circle-12, New Delhi ITA.No.6281 to 6383/Del./2014 etc., decided on 4th January, 2016 is relied upon by the Learned Counsel for the Assessee. Copy of the order 7 ITA.Nos.6390, 6391, 6392/D/2014 Smt. Chandravati Gupta, Delhi & ITA.Nos.6405, 6406, 6407, 6408, 6409 & 6410/D/2014 C S Leasing Pvt. Ltd., Delhi.
is placed on record. On identical facts, the Tribunal cancelled the penalty levied under section 271(1)(b) of the I.T. Act.
7. On the other hand, the Ld. D.R. relied upon the orders of the authorities below.
8. We have considered the rival contentions and perused the findings of the authorities below. The assessee explained the reasons for non-compliance of the notices dated 11th January, 2013 and 9th October, 2012 as noted above, which have not been disputed through any evidence or material on record. The Ld. CIT(A) for two years in each appeal have deleted the penalty. Meaning thereby, the Ld. CIT(A) was satisfied with the explanation of the assessee. Therefore, he should not have taken different view for one year on the same reasoning. In cases of Mrs. Usha Gupta etc., and Saraswati Resorts Pvt. Ltd., and another (supra), on the same reasoning, the penalty levied under section 271(1)(b) have been cancelled by the Tribunal. It, therefore, appears that assessee has disclosed the reasonable cause for failure to comply with the statutory notice and on the same reasoning, the Ld. CIT(A), cancelled the penalty under section 271(1)(b) of the I.T. Act for two years in both the appeals. Therefore, following the rule of consistency, the Ld. CIT(A) should have cancel the penalty in this year as well. We, accordingly, set aside the orders of the Ld. CIT(A) and cancel the penalty. Accordingly, the grounds of the assessee are allowed.8
ITA.Nos.6390, 6391, 6392/D/2014 Smt. Chandravati Gupta, Delhi & ITA.Nos.6405, 6406, 6407, 6408, 6409 & 6410/D/2014 C S Leasing Pvt. Ltd., Delhi.
9. In the result, both the appeals of the assessee are allowed."
5.1. He has submitted that similar order is followed by ITAT "E" Bench in other case of Smt. Neeru Gupta, Delhi vs. ACIT, Central Circle-12, New Delhi and the Tribunal by order dated 01.09.2017 in ITA.Nos.6569, 6570 & 6571/Del./2014 allowed the appeal of assessee.
6. The Ld. D.R. on the other hand relied upon the orders of the authorities below.
7. Considering the facts of the case in the light of the order of the ITAT, Delhi Bench in the case of M/s. Macadam Road Makers P. Ltd., Delhi vs. ACIT, Central Circle-12, New Delhi (supra), we find that the issue is covered by the above decision of the Tribunal. We accordingly, set aside the orders of the authorities below and cancel the penalty in all the three assessment years.
8. In the result, appeal of the assessee is allowed. 9
ITA.Nos.6390, 6391, 6392/D/2014 Smt. Chandravati Gupta, Delhi & ITA.Nos.6405, 6406, 6407, 6408, 6409 & 6410/D/2014 C S Leasing Pvt. Ltd., Delhi.
C.S. LEASING PVT. LTD., - ITA.Nos.6405, 6406 and 6407/Del./2014 - (A.Ys. 2005-06, 2006-07 & 2007-08) :
9. The assessee-company in all the above three years challenged the order of the Ld. CIT(A)-XXXI, New Delhi dated 1st September, 2014, challenging the levy of penalty under section 271(1)(b) of the I.T. Act, 1961.
10. The Ld. CIT(A) noted that A.O. issued notice under section 143(2)/142(1) of the Act on 19th September, 2012 fixing the case for hearing on 9th October, 2012. No one attended. It was stated by assessee in the written submissions that Mrs. Anju Gupta, daughter- in-law of the principal officer of the assessee-company was suffering from severe disease and had to be hospitalized on 06.10.2012. Thereafter, on 09th October, 2012, Mr. Satya Prakash Gupta, principal officer of the assessee-company himself suffered heart- attack and had to be hospitalized. The Ld. CIT(A) however, did not accept the explanation of the assessee. However, considering it to be harsh on the assessee-company to levy penalty for seven years, the Ld. CIT(A) confirmed the levy of penalty under section 271(1)(b) of the I.T. Act for A.Ys. 2005-06, 2006-07 and 2007-08 but deleted the 10 ITA.Nos.6390, 6391, 6392/D/2014 Smt. Chandravati Gupta, Delhi & ITA.Nos.6405, 6406, 6407, 6408, 6409 & 6410/D/2014 C S Leasing Pvt. Ltd., Delhi.
penalty for remaining assessment years 2008-09, 2009-10, 2010-11 and 2011-12. The assessee is in appeal for the above three A.Ys 2005-06, 2006-07 and 2007-08 in ITA.Nos.6405, 6406 & 6407/Del./2014.
C.S. LEASING PVT. LTD., ITA.Nos.6408, 6409 & 6410/Del./2014 A.Ys 2005-06, 06-07 & 07-08.
11. The assessee-company challenged common orders of Ld. CIT(A)-XXXI, New Delhi, dated 01.09.2014, challenging the levy of penalty under section 271(1)(b) of the I.T. Act, 1961.
12. In these remaining appeals, the Ld. CIT(A) noted there is default for compliance of the notice on dated 11th January, 2013. Reply of the assessee-company was same that Mrs. Abha Gupta, daughter-in-law of the principal officer of the assessee-company was suffering from severe illness and had to be hospitalized on 11.01.2013. Similarly, Shri Satyaprakash Gupta also suffered from heart attack. The Ld. CIT(A) similarly confirmed the penalty for three years i.e., A.Ys. 2005-06 to 2007-08 and cancelled the penalty for 11 ITA.Nos.6390, 6391, 6392/D/2014 Smt. Chandravati Gupta, Delhi & ITA.Nos.6405, 6406, 6407, 6408, 6409 & 6410/D/2014 C S Leasing Pvt. Ltd., Delhi.
remaining four assessment years i.e., from A.Ys. 2008-2009 to 2011- 2012.
12.1. The issue in all six appeals are same as have been considered and decided in three appeals of Smt. Chandravati Gupta (supra). Following the reasons for decision in that case, we set aside the orders of the authorities below and cancel the penalty in all six appeals.
13. In the result, all the above appeals of the assessee are allowed.
14. To sum-up, appeals of both the assessees for various assessment years are allowed.
Order pronounced in the open Court.
Sd/- Sd/-
(PRASHANT MAHARISHI) (BHAVNESH SAINI)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Delhi, Dated 13th October, 2017
VBP/-
12
ITA.Nos.6390, 6391, 6392/D/2014 Smt. Chandravati Gupta, Delhi & ITA.Nos.6405, 6406, 6407, 6408, 6409 & 6410/D/2014 C S Leasing Pvt. Ltd., Delhi.
Copy to
1. The appellant
2. The respondent
3. CIT(A) concerned
4. CIT concerned
5. D.R. ITAT "B" Bench
6. Guard File //By Order// ASST. REGISTRAR : ITAT :
DELHI BENCHES : DELHI.