Income Tax Appellate Tribunal - Chandigarh
M/S Marvel Dyers & Processors Pvt. Ltd., ... vs Acit, Cc-Ii, Ludhiana on 21 May, 2019
आयकर अपील य अ धकरण,च डीगढ़ यायपीठ, "बी" च डीगढ़
IN THE INCOME TAX APPELLATE TRIBUNAL
DIVISION BENCH, 'B', CHANDIGARH
ी एन. के. सैनी, उपा य एवं ी संजय गग , या यक सद य
BEFORE SHRI N.K. SAINI, VICE PRESIDENT &
SHRI SANJAY GARG, JUDICIAL ME MBER
आयकर अपील सं./ ITA No. 2 6 5 / C H D / 2 0 1 8
नधा रण वष / Assessment Year :
2014-15
Sh. Sadhu Ram Rupal, Vs. The ACIT, Central
H.N. 374, Baba Balak Nath बनाम Circle-II, Ludhiana
Road, Civil Lines,
Ludhiana
थायी ले खा सं . / PAN NO: AAZPR4905L
अपीलाथ&/ Appellant ()यथ& / Respondent
&
आयकर अपील सं./ ITA No. 2 6 6 / C H D / 2 0 1 8
नधा रण वष / Assessment Year : 2 0 1 4 - 1 5
M/s Marvel Dyers & Vs. The ACIT,
Processors Pvt Ltd., बनाम Central Circle-II,
Village Meharban, Ludhiana
Rahon Road, Ludhiana
थायी ले खा सं . / PAN NO: AAACF2565J
अपीलाथ&/ Appellant ()यथ& / Respondent
नधा *रती क, ओर से / Assessee by : Sh. Ashwani Kumar, CA
राज व क, ओर से / Revenue by : Sh. Manjit Singh, CIT DR
सु न वाई क, तार0ख / Date of Hearing : 25.03.2019
उदघोषणा क, तार0ख/ Date of Pronouncement : 21.05.2019
आदे श/ Order
Per Sanjay Garg, Judicial Member:
The present appeals have been preferred by the different assessees against the separate orders dated 7.12.2017 of the Commissioner of Income Tax (Appeals)-5, Ludhiana [hereinafter referred to as CIT(A)].
ITA Nos.265-c-2018 & 266-c-2018- Sh. Sadhu Ram Rupal & M/s Marvel Dyers & Processors, Ludhiana 2
2. Since the appeals having common issues involved were heard together, therefore these are being disposed off by this consolidated order for the sake of convenience and brevity.
3. First, we shall deal with appeal in ITA No. 265/Chd/2018 for the Assessment Year 2014-15, wherein, the only ground raised by the assessee reads as under:-
That order passed u/s 250(6) of the Income Tax Act, 1961 by the Ld. Commissioner of Income Tax (Appeals)-5, Ludhiana upholding levy of penalty u/s 271AAB at Rs. 7,00,000/- is against law and facts on the file in as much no such penalty was exigible in the facts and circumstances of the case.
4. The assessee in this appeal has contested the conformation of penalty levied by the Assessing officer @ 10% of the undisclosed income under section 271AAB (1) of the Income Tax Act.
5. At the outset, the Ld. Counsel for the assessee has submitted that the penalty u/s 271AAB of the Act levied by the Assessing Officer was void abinitio because he has not taken the prior approval under section 274(2) of the Act, which was accorded vide letter no. 1036 dt. 30/09/2016 while the penalty order was passed by the Assessing Officer on 29/09/2016 i.e; prior to taking the approval from the Additional CIT, Central Circle, Range Ludhiana.
ITA Nos.265-c-2018 & 266-c-2018- Sh. Sadhu Ram Rupal & M/s Marvel Dyers & Processors, Ludhiana 3
6. In his rival submissions the Ld. Sr. DR strongly supported the order of the authorities below and further submitted that there may be a typographical mistake in the order passed under section 271AAB(1) of the Act and by mistake the date was mentioned as 29/09/2016 while the DCR number was dt. 30/09/2016.
7. We have considered the submissions of both the parties and perused the material available on the record. To resolve the present controversy it is relevant to refer the provisions contained in Section 274(2) of the Act which read as under:
"Section 274(1)............ (2) No order imposing a penalty under this Chapter shall be made-
(a) by the Income-tax Officer, where the penalty exceeds ten thousand rupees;
(b) by the Assistant Commissioner or Deputy Commissioner, where the penalty exceeds twenty thousand rupees, except with the prior approval of the Joint Commissioner."
8. From the above provisions contained in section 274 of the Act, it is crystal clear that the penalty under section 271AAB of the Act, which falls in Chapter XXI of the Act shall not be imposed by the Assessing Officer until and unless prior approval is taken from the concerned Joint Commissioner of Income Tax ITA Nos.265-c-2018 & 266-c-2018- Sh. Sadhu Ram Rupal & M/s Marvel Dyers & Processors, Ludhiana 4 (JCIT). The use of word "shall" make it mandatory to take the prior approval of the JCIT / Additional CIT before passing the order imposing the penalty under section 271AAB of the Act. In the present case it is crystal clear from the penalty order passed by the Assessing Officer that the order was passed on 29/09/2016 while the approval from the Additional CIT, Range Ludhiana was accorded vide letter no. 1036 dt. 30/09/2016, which clearly established that the penalty order was passed by the Assessing Officer on 29/09/2016 before taking the approval from the concerned Additional CIT / J.C.I.T. The contention of the Ld. DR that the same may be a typographical mistake is not tenable because the relevant column of 'approval letter No.' and 'Date' had been left blank in the penalty order which have been filled with pen on receipt of said approval letter and the date mentioned falls after the date of pronouncement of impugned penalty order. Therefore, the penalty order passed by the Assessing Officer for levying the penalty under section 271AAB of the Act is void abinitio. In that view of the matter the impugned penalty levied u/s 271AAB of the Act by the Assessing Officer and sustained by the Ld. CIT(A) is deleted.
ITA Nos.265-c-2018 & 266-c-2018- Sh. Sadhu Ram Rupal & M/s Marvel Dyers & Processors, Ludhiana 5 ITA No. 266/Cdh/2018
9. In ITA No. 266/Chd/2018 for the A.Y. 2014-15, the facts are identical as were involved in the ITA No. 265/Chd/2018 in the case of Sahdu Ram Rupal, Ludhiana. The only difference is in the amount of penalty u/s 271 AAB of the Act levied by the Assessing Officer and sustained by the Ld. CIT(A), therefore, our findings given in the former part of this order shall apply mutatis mutandis. Accordingly the penalty levied by the Assessing Officer under section 271AAB of the Act and sustained by the Ld. CIT(A) in this appeal is also deleted.
In the result, both the appeals of the assessees are allowed. O r d er p r o n o u n c ed in t h e O p en C o u r t o n 2 1. 0 5. 2 0 1 9 Sd/- Sd/-
(एन. के. सैनी / N.K. SAINI) (संजय गग" / SANJAY GARG) उपा$य% / Vice President या&यक सद'य/ Judicial Member Dated : 21.05.2019 "आर.के."
आदे श क, ( त4ल5प अ6े5षत/ Copy of the order forwarded to :
1. अपीलाथ&/ The Appellant
2. ()यथ&/ The Respondent
3. आयकर आयु7त/ CIT
4. आयकर आयु7त (अपील)/ The CIT(A)
5. 5वभागीय ( त न9ध, आयकर अपील0य आ9धकरण, च;डीगढ़/ DR, ITAT, CHANDIGARH
6. गाड फाईल/ Guard File ITA Nos.265-c-2018 & 266-c-2018-
Sh. Sadhu Ram Rupal & M/s Marvel Dyers & Processors, Ludhiana 6 आदे शानस ु ार/ By order, सहायक पंजीकार/ Assistant Registrar