Central Administrative Tribunal - Jaipur
Unknown vs Union Of India Through Chairman on 20 May, 2011
IN THE CENTRAL ADMINISTRATIVE TRIBUNAL JAIPUR BENCH Jaipur, this the 20th day of May, 2011 ORIGINAL APPLICATION NO. 57/2008 CORAM HONBLE MR. JUSTICE K.S. RATHORE, JUDICIAL MEMBER HONBLE MR. ANIL KUMAR, ADMINISTRATIVE MEMBER P.C. Sharma son of Late Shri Badri Prasad Sharma, aged 55 years, resident of 2, Dayal Nagar, Gopalpura Byepass, Jaipur. Presenlty posted as ACIT, Circle-I, Jaipur. ..Applicant (By Advocate: Mr. C.B. Sharma) VERSUS 1. Union of India through Chairman, Central Board of Direct Taxes, Department of Revenue, Ministry of Finance, North Block, Central Secretariat, New Delhi. 2. Commissioner of Income Tax, Aaykar Bhawan, Moti Doongari, Alwar. ..Respondents (By Advocate: Mr. Gaurav Jain) ORDER (ORAL)
The present OA is directed against the order dated 02.11.2007 passed by the Chairman, Central Board of Direct Taxes whereby the departmental appeal filed by the applicant has been dismissed and also against the illegal penalty order dated passed 28.03.2002 passed by the Commissioner of Income Tax Alwar whereby a penalty of censure was imposed.
2. Brief facts of the case are that the applicant was working as Income Tax Officer, Alwar under respondent no. 2. He was served a charge sheet alleging therein that he did not bring to the notice to this superior regarding the existing demand in case of M/s Shyam Sunder Parwani & Party and notice under Section 226(3) of Income Tax Act 1961 issued to him alleging therein that his conduct was in favour of the assessee.
3. Commissioner of Income Tax after examining the matter and after consideration of the facts deemed it fit to impose the penalty of censure on the applicant as he held guilty of the charge of not bringing to the notice of his superiors the fact of existing demand in the case of M/s Shyam Sunder Parwani & Party. The applicant has not disclosed this fact to the DCIT Kota Range, Kota while seeking his approval for refund vide his letter dated 15.11.1995.
4. The applicant submitted his detailed reply dated 05.11.1999 and thereafter supplementary reply dated 27.06.2000 to the Memo of charge sheet dated 09.07.1999 and in was specifically submitted that remittance of 53% share in refund of M/s Shyam Sunder Parwani & Party in favour of DCIT, Kota for adjustment of demand was not supported by any provisions of Act/Circular or notification of the CBDT and there was no debtor-creditor relationship between the AOP assessed by the DCIT Kota and the ITO Ward-3 Kota and if such relationship did not exist then no proceedings under Section 226(3) of IT Act should have taken against ITO Ward-3. It is also submitted that there was no legal provision to ask for adjustment of amount equal to the profit sharing ratio in the refund amount and there was debit balance of more than Rs.30 lacs in the case of M/s Shyam Sunder and credit balance of only 1 lac was in the case of Shri P.L. Talwar, therefore, there was no question for remittance of refund equal to profit sharing ratio of Shri Shyam Sunder in the AOP assessed by the ITO Ward-3, Kota, which was 50%. The set off of refund can be made against tax remaining payable by the same assessee. There is express provision in the Income Tax Act, 1961, contained in Section 245 for procedure to be followed for aforesaid purpose.
5. It is further submitted that the concerned assessee AOP never agreed for refund of such amount, however, the assessee agreed to deposit the amount equal to the share of Shri P.L. Talwar and an amount of Rs.1,02,000/- equivalent to his share was received by the applicant and the same was deposited with the DCIT Kota and the same was received due to the personal efforts of the applicant.
6. It is alleged that the Commissioner of Income Tax, Alwar (Disciplinary Authority) without considering the facts and circumstances, the submissions made by the applicant and without application of mind issued order dated 28.03.2002 and imposed a minor penalty of censure upon the applicant under the provisions of Rule 11(1) read with Rule 16 of CCS(CCA) Rules, 1965.
7. Feeling aggrieved by the aforesaid order passed by the Disciplinary Authority, the applicant submitted a departmental appeal before the Chief Commissioner of Income Tax, Jaipur on 08.8.2002 with a delay of 45 days and an application for condonation of delay explaining the cause of delay but the same was dismissed vide order dated 02.11.2007. Feeling aggrieved, the applicant preferred this present OA.
8. We have heard the rival submissions of the respective parties and after going through the relevant provisions of law as well as Memo of charge sheet, penalty awarded by the Disciplinary Authority as per the statement of misconduct in support of articles of charges framed against the applicant which reveals that the applicant is guilty of the charge of not bringing to the notice of his superiors the fact of existing demand in the case of M/s Shyam Sunder Parwani & Party and the notice under Section 226(3) issued to him by the DCIT Special Range, Kota in this behalf. This was a material fact, which was not disclosed by the applicant to the DCIT Kota Range, Kota while seeking his approval for refund vide his letter dated 15.11.1995. The Disciplinary Authority had further observed that no inference of having an intention to the favour of the assessee can be drawn on the basis of letters written by the applicant. The only thing which he ought to have done was to adjust 3% of the refund amount against the demand of AOP assessed by the Dy. CIT, Special Range Kota because it was equivalent to the share of refund of Shri P.L. Talwar, who had agreed for such adjustment.
9. The Appellate Authority also considered the penalty awarded by the Disciplinary Authority and after careful consideration, he found no merit in the appeal of the applicant and held that the applicant was bound by the notice under Section 226(3) and should not have issued the refund to the assessee. Non compliance of a statutory notice under Section 226(3) of IT Act is a gross misconduct on the part of the charged officer and the finding of the Disciplinary Authority was upheld by reads as under:-
226(3)(i) The Assessing Officer or Tax Recovery Officer may at any time from time to time, by notice in writing require any person from who money due or may become due to the assessee or any person who holds or may subsequently hold money for or on account of the assessee to pay to the Assessing Officer or Tax Recovery Officer either forthwith upon the money becoming due or being held or at or within the time specified in the notice (not being before the money becomes due or is held) so much of the money as is sufficient to pay the amount due by the assessee in respect of arrears on the whole of the money when it is equal to or less than that amount.
11. Upon perusal of the Section 226(3)(i) of the Income Tax, it is evident that applicant has not complied with the aforesaid provisions, which requires to issue statutory notice. Thus we are of the view that the minor penalty of censure issued by the Disciplinary Authority vide order dated 28.03.2002 and upheld by the Appellate Authoritys order dated 02.11.2007 requires no interference by this Tribunal. Consequently, the present OA is dismissed being bereft of merit with no order as to costs.
(ANIL KUMAR) (JUSTICE K.S. RATHORE) MEMBER (A) MEMBER (J) AHQ