Income Tax Appellate Tribunal - Delhi
Jayanti Dalmia, New Delhi vs Dcit, New Delhi on 20 January, 2022
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCHES 'Friday-G', NEW DELHI
Before Sh. Kul Bharat, Judicial Member
Dr. B. R. R. Kumar, Accountant Member
MA No. 31/Del/2019
(in ITA No. 3920/Del/2015 : Asstt. Year : 2006-07)
MA No. 32/Del/2019
(in ITA No. 3921/Del/2015 : Asstt. Year : 2007-08)
MA No. 33/Del/2019
(in ITA No. 3922/Del/2015 : Asstt. Year : 2008-09)
MA No. 34/Del/2019
(in ITA No. 3923/Del/2015 : Asstt. Year : 2009-10)
MA No. 35/Del/2019
(in ITA No. 3924/Del/2015 : Asstt. Year : 2010-11)
MA No. 36/Del/2019
(in ITA No. 3925/Del/2015 : Asstt. Year : 2011-12)
MA No. 37/Del/2019
(in ITA No. 3926/Del/2015 : Asstt. Year : 2012-13)
Mrs. Jayanti Dalmia, Vs DCIT,
2nd Floor, Indraprakash Building, Central Circle-26,
21, Barakhamba Road, New Delhi New Delhi
(APPELLANT) (RESPONDENT)
PAN No. AADPD9437D
Assessee by : Sh. V. K. Bindal, CA
Revenue by : Sh. Mrinal Kumar Das, Sr. DR
Date of Hearing: 07.01.2022 Date of Pronouncement: 20.01.2022
ORDER
Per Dr. B. R. R. Kumar, Accountant Member:
These Miscellaneous Applications have been filed by the assessee arising out of the order dated 31.10.2018 in ITA Nos. 3920 to 3926/Del/2015.
2 MA Nos. 31 to 37/Del/2019Jayanti Dalmia
2. The order of the ITAT dated 31.10.2018 in ITA Nos. 3920 to 3926/Del/2015 reads as under:
"Th e s e are the s e v en ap p e al s f il ed by the a s s e ss e e , Mr s . J a yan t i D ala m ia , ag ain st t h e o rd e r of t h e l d C om m is si on e r of In c om e t a x ( A p p eal s) - 2 9 , N e w D elh i [ t h e L d C I T ( A ) ] d at ed 0 5 .0 5 .2 0 1 5 f o r t h e A s s es s m en t Y ea r 2 0 0 6 - 0 7 t o 2 0 1 2 - 1 3 wh e r ein p en a lt y l e vi ed by the D ep u t y C om m i s si on e r o f In c o m e t ax , C en t ral Ci r cl e- 2 6 , N e w D elh i [ Th e d A O ] u n d e r s e ct i on 2 7 1 ( 1 ) ( b ) o f Th e In c o m e Ta x A ct [ Th e A ct ] o f ₹ 1 0, 0 0 0/ - for all these y ea r s for not su b m i t t in g „ c on s en t l et t e r ‟ for v er ifi c at i on of al l eg ed fo r e ig n s wi ss b a n k a c c ou n t s a r e c on fi rm ed .
2. Th ou g h t h e le a rn ed A O h as p as s ed t h e p en al t y or d e r u n d e r s e ct i on 2 7 1 ( 1) ( b ) of t h e in c om e t a x a ct , 1 9 6 1 f o r a ll t h es e y e ar s s ep a rat e ly , h o w ev e r , t h e l ea rn ed C IT ap p eal h a s p as s ed t h e c o m m o n o r d er f o r al l t h e s e y e ar s . Th e fa ct s an d ci rcu m st an c e s o f t h e c ase f o r all t h es e y ea r s ar e si m il ar an d t h e r e fo r e t h es e ap p e al s a r e h e ar d t og et h e r an d d e cid ed b y t h i s c om m on o r d e r .
3. F ir st l y , w e st a t e t h e fa ct s f o r a s s e ss m en t y ea r 2 0 0 6 - 0 7 an d al s o t h e g r ou n d rai s ed b y t h e a s s e ss e e wh i c h a r e a s u n d er: -
"1 . Th at l e arn e d C om m i ss i on e r of In c om e Ta x ( A p p ea ls ) h as e r r ed in c on f ir m in g t h e p en alt y l e vi ed b y t h e A s s es sin g O f fi c e r u / s 2 7 1 ( l) ( b ) of t h e In c o m e Ta x A ct , 1 9 6 1 in an am ou n t of R s . 1 0 ,0 0 0/ - f o r A s s e s sm en t Y ea r 2 0 0 6 - 0 7 , on t h e b a si s t h at t h e a p p e llan t h a s n ot fu r n ish ed 'c on s en t f or m ' in r e sp e ct o f al le g ed u n d is cl o s ed o v e rs e a s b an k ac c ou n t , ev en t h ou g h the ap p e ll an t d en i es h a vin g an y su ch b an k a cc ou n t an d c on s e q u en t l y c an n o t fu rn i sh su ch 'c on s en t f o r m ' c ont a in i n g s om e b an k a/ c n u m b e r n ot b ei n g o wn ed b y t h e a p p e llan t a s s e ss ee a n d h i s o rd e r is b ad in la w an d ag a i n st t h e f act s an d ci r cu m st an c e s of t h e c as e .
2 . T h at sin c e t h e a p p e llan t d en i e s h av in g an y b an k a c c ou n t wit h F I S B C Ban k , G en ev a, S wi t z e rl an d , it can n ot b e c om p e ll ed t o g en e rat e a rt i fi cial b an k ac c ou n t o p en i n g f o rm an d is su e c on s en t l e t t e rs in fa v ou r of an y au t h o rit y .3 MA Nos. 31 to 37/Del/2019
Jayanti Dalmia 3 . Th a t t h e ap p el la n t h a vin g d u ly c o m p li ed wit h n o ti c e u / s 1 4 2 ( 1 ) of t h e In c o m e Ta x A ct , 1 9 6 1 t h er e w a s n o r e as on f o r l ev y of p en alt y u / s 2 7 1 ( l ) ( b ) of t h e In c om e Ta x A ct , 1 9 6 1 on in c or r e ct a s su m p t ion o f fa ct s .
4. Th at the ab ov e G r ou n d s of A p p e al are wi t h o u t p r ej u d ic e to on e an o t h e r. "
4. A s s es s e e i s an in d i v id u al . S ea r ch an d s eiz u r e u / s 1 3 2 of t h e in co m e t ax a ct w as ca r ri ed ou t in t h e g r ou p ca s e on 2 0/ 1/ 20 1 2 . S u b s eq u en t ly n ot i c e u n d e r s e ct i o n 1 5 3A o f t h e in c om e t a x a ct w as i s su ed t o t h e as s e ss e e . Th e a s s e s s e e su b m it t e d h e r r et u rn of in c om e .
5. D u rin g t h e c ou r s e o f a s s e ss m en t p r oc e ed i n g s , n o ti c e u n d e r s e ct i on 1 4 2 ( 1) of t h e In c om e Ta x A ct wa s i s su ed on 1 8/ 7/ 2 01 3, cal lin g f or in f o rm at i on in r e sp e ct of h e r all eg ed b an k a c c ou n t in HS BC G en e va/ Zu r ich , S wit z e rl an d h avin g c od e BU P _ S IF IC _ P ER _ ID _ 50 0 1 5 7 5 4 8 P r o fil e c od e 5 0 9 1 4 4 5 4 4 8, Pr o fil e c od e 5 0 9 1 3 2 1 6 1 7, P r o fil e cod e 5 0 9 1 3 1 2 0 5 7 Pr o fil e c od e 5 0 9 1 3 1 0 0 7 0 an d P r ofi l e CH O TU MA N 2 1 . Th e as s e ss e e wa s als o r eq u e st ed t o f u rn i sh t h e e vid en c e s in t h e f o rm of a c c ou n t o p en in g f or m in r es p ec t o f fo r ei g n b an k ac c o u n t , c o m p l et e b an k st at e m en t in o rig in al in t h e f o r e ig n b an k m en t i on e d sin c e b eg in nin g an d r e sid en t i al st at u s as p e r t h e in c om e t ax ac t a s on t h e d at e o f op en in g o f t h e f o r ei g n b an k a c c ou n t an d s u b s eq u en t ly f o r a ll t h e s e y ea r s. Th e l e arn e d a s s es sin g o ffi c e r fu rt h e r st at e d t h at in c as e t h e as s e ss e e d oes n o t h av e a n y b an k ac c ou n t st at e m en t , sh e m a y fu rn i sh d u ly fi ll ed u p , sig n e d an n ot ar iz ed „c on s en t l et t e r‟ s o t h at t h e o ffi c e o f t h e l e a rn ed a s s e s sin g o ff ic e r can h el p h e r ob t ain t h e ac c ou n t st at em e n t f r om t h e b an k. Th e as s e s s e e w as d ir e ct e d t o fu rn i sh t h e ab ov e in f o rm at i on an d t h e „ c on s en t let t e r‟ on o r before 2 2 / 7/ 2 0 1 3 . A lo n g wi t h the l et t e r , the as s e s sin g o ff ic e r al s o at t a ch ed a p r o f o rm a c op y o f t h e c on s en t l et t e r t o b e su b m it t ed b y t h e as s e ss e e . A O m en t i on ed t h at t h i s l et t e r is n ot i c e u/ s 1 4 2 ( 1) of t h e a ct . Th e l e a rn ed a ss e s si n g of fi c e r fu rt h e r i n f o rm ed t h e a ss e s s e e t h at in c as e o f n on - c o m p li an c e , p en alt y p r o vi si on s wo u ld b e in iti at ed .
6 . Th e a ss e s s e e d i d n ot c om p ly on t h e ap p oi n t ed d at e an d in st e ad on 2 3/ 7/ 2 0 1 3 a ss e s s e e su b m it t ed t h at sh e d o e s n ot h av e su ch b an k a c c ou n t 4 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia an d t h e r e i s n o q u e st i on of su b m i t t in g an y c on s en t l et t e r . F u rt h er , sh e d id n o t fil e t h e c on s en t l et t e r on t h at d at e o r at an y t im e t h e r ea ft e r .
7 . Th e r e f o r e t h e l e arn e d as s e ss in g o f f ic e r n o t e d t h e n on c om p lian c e an d h en c e , in it ia t e d t h e p en al t y p r o c e ed in g s u n d e r s e cti on 2 7 1 ( 1) ( b ) o f t h e act an d i s su ed sh o w c au s e n ot i c e on 2 6 / 9/ 2 0 1 3 fi xing t h e d at e of h ea rin g on 3 0/ 9/ 2 0 1 3 . O n t h e ap p oin t ed d at e t h e a ss e s s e e sub m it t ed a l et t e r st at in g t h a t a s se s s e e h a s a l r ead y co m p l ied wit h t h e l et t e r n ot i c e d at ed 1 8 J u ly 2 0 1 3 an d st a t e d t h at t h e r ep ly t o t h e sa id l ett e r i s su b m it t ed on 2 2 J u ly 2 0 1 3 ( ac t u al d at e of su b m i s si on is 2 3/ 0 7/ 2 0 1 3 ) . Th e a ss e s s e e , t h e r e f o r e, s t at ed t h at t h e r e i s n o r e as on f o r is su e o f n ot i c e f o r p en alt y. Th e l ea rn ed as s e s s in g o ff ic e r n ot ed t h at t h e l et t e r su b m it t ed b y t h e as s e ss e e on 2 3/ 7/ 2 0 1 3 st at e d t h a t sh e d o e s n ot h av e an y c on n e ct i on wit h an y o f t h e a ll eg ed a c cou n t s an d t r an s ac t ion s d et a il ed in t h e ab o v e n ot i c e an d d en y t h at an y of t h e s e a cc ou n t s , t ran sa ct i on s b el on g t o h er . S h e fu rt h e r st at ed t h at sin c e t h es e t r an s a ct i on s , ac c oun t s o r co d es d o n ot b el on g t o h e r , t h e r e is n o q u e st i on o f h e r r e c eiv ing an y in f o rm at i on f r om HS BC b an k , S w it z e rla n d or h e r su b m i t t in g an y o f t h e d et ail s a sk ed in n ot i c e i ssu e d b y t h e lea rn ed A O . S h e al s o st at ed t hat t h e r e is n o q u e st i on o f si g n in g h e r an y c on s en t l et t e r i n t h i s r eg a rd , a s sh e d o e s n ot h a v e t h a t b an k ac c ou n t . Th e le ar n ed as s e s sin g o ffi c e r n o t ed th at t h e e xp l an at i on su b m it t ed b y t h e a s se s s e e i s n ot sat i sf a ct o ry , a s sh e h a s n ot fil ed t h e c on s e n t l et t er d u l y fil l ed in an d sig n ed viz a viz c op y o f h e r b an k st at e m en t . A cc o rd in g t o t h e l e a rn ed a s se s sin g o ff ice r , t h is sh ow s n on - c om p lian c e on t h e p a rt o f t h e a ss e s s e e f o r wh ich t h e a s s e ss e e h as n ot g iv en an y p la u si b l e r ea s on , i n su p p or t o f h e r c on t en t i on t h at p en alt y p r o c e ed in g s sh ou ld b e d r op p e d . H e f u rt h e r st at e d t hat in vi ew o f t h e ab ov e f act s , t h e r e i s a failu r e on p a rt o f t h e a ss es s e e t o c om p ly w it h t h e t e rm s of t h e n ot i c e is su ed t o h e r on 1 8 / 7/ 2 0 1 3 an d t h e r e f o r e h e le vi ed a p en alt y o f ₹ 1 0 ,0 0 0 u n d e r s e ct i on 2 7 1 ( 1) ( b ) o f t h e in c o m e t a x a ct vid e o rd e r d at ed 1 2 / 1/ 2 0 1 5 . S i m il a r p en alt y o rd e r s w er e al s o p a s se d f o r si x ot h e r y e a rs u p t o A Y 2 0 1 2 - 1 3 .
8 . A g g ri ev e d b y t h e o rd e r o f t h e l ea rn ed a ss e s sin g o f fi c e r, a ss e s s e e p r e f e r r ed an ap p ea l b e f o r e t h e le a rn ed C o m m i s si on e r o f In c om e T ax A p p eal s- 2 9 , N e w D elh i . Th e l ea rn ed c om m i ss i on e r A p p e a ls p as s ed t h e c on s o lid a t ed o rd e r f or a ss e s sm en t y ea r 2006-07 to 2012-13 on 5 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia 5/ 0 5/ 2 0 1 5 wh e r e in , he c on fi rm ed the p en alt y l e vi ed by the l ea rn ed as s e ss in g o ff ic e r f o r all t h es e y e ar s . A ft e r c on sid e rin g t h e e xp l an at i on fu rn i sh ed b y t h e a s se s s e e , l ea rn ed c om m i ss i on e r ap p eal s h eld t h at in A p r il/ May 2 0 1 1 , In d ia r e c ei v ed i n f o rm at i on f r om a fo r eig n g ov e rn m e n t under the D ou b l e Ta xat i on A v o id an c e A g r e e m en t t h at c e rt a in In d ian p as sp o rt h old e r s h av e o p en ed an d h a d m ain t ain ed b an k ac cou n t s wit h H on g K on g an d S h an g h ai b an k in g C o rp ( HS BC ) in S w it ze r lan d . Th e in f o rm at i on r e c ei v e d wa s c o v er e d u n d e r t h e c on fid en t ial it y clau s e o f t h e D ou b l e Ta xat i on A vo id an c e A g r e em en t an d it s co n t en t s cou ld n o t b e d is cl o s ed b y t h e in c om e t a x d e p a rt m e n t wi t h ou t e xp re s s c on s e n t o f t h e c ou n t ry , wh ich h ad sh a r ed t h e in f or m at i on . Ba s ed on t h e s e in f o r m at i on in v e st ig a t i on s w e r e in it iat e d b y t h e in c om e t a x d ep ar t m en t in J u ly 2 0 1 1 . S o m e p er s on s ap p e ar e d b e f o r e t h e t a x au t h o rit i e s and h a v e ad m it t e d t h at t h e y h a v e h ad b an k ac c ou n t wit h HS BC an d p ai d t h e d u e t ax on t h e m ax im u m a m ou n t d ep o si t ed / ou t st a n d i n g in t h o s e a c c ou n t s . In s e v e ral ca s e s, s ea r ch w e r e c on d u ct ed an d t h e p e r s on s e a rch ed al s o ad m it t ed t o h av e o p en ed ac c ou n t ov e r s ea s an d n ot d i sc l os e d f or t a x p u r p o s e s in In d ia . H o w ev e r , d u rin g t h e i n v e st ig at i on , s ev e r al p e r s on s h av e d en i ed ou t rig h t ly h a vin g o p en e d an y su ch b a n k ac c ou n t s o v ers e as wh i l e s om e p e r s on s h av e ad m i t t e d op en in g the ac c ou n t , but d en i e d h avin g an y t ra n s ac t i on s. In c as e s , wh e r e the d et ail s of the t ran sa ct i on in the ac c ou n t s w e r e n ot ava ilab l e, o r wh e r e p e r s on s h av e d en i ed an y a c c ou n t o r an y t r an sa ct i on i n t h e a c c ou n t r e f e r en c e h a s b e en m ad e t o H on g K on g an d S h an g h ai b an k in g Co r p b y w ay o f a c on s en t l et t er sig n ed b y t h e ac c ou n t h old e r d u l y n ot a ri z e d t o en ab l e H on g K on g an d S h an g h ai b an k in g Co r p t o fu rn i sh t h e r eq u i si t e d et ai ls su c h as a c c oun t op en in g fo r m , ot h e r d o cu m en t s , n am e s o f b en e fi cia r i es , d e t ail s o f t r an sa ct i on s et c e t e ra o f t h e a cc ou n t h old e r . In s om e su ch c as e s, a c c ou n t h ol d er s h av e al r ea d y r e c eiv e d in f o rm at i o n fr o m HS BC a n d a r e c o op e r at in g w it h t h e d ep ar t m en t in it s in v e st ig at i on s . Th e l e a rn ed CI T f u rt h e r n o t ed t h at t h e in c o m e t ax act , 1961 has al s o been a m en d ed to p ro vi d e for re o pen in g of tax as s e ss m en t s f or a p e ri o d of 1 6 y ea r s t o c o v e r s u ch c as e s, wh i ch h a s e sc ap ed a ss e s sm en t . Th er e f o r e , o n ly i n su ch c a s es wh e r e su ch p e r so n s h av e r efu s ed t o d eli v e r si g n ed c on s en t l et t e r s t h e p e n alt y h as b e en in it iat e d an d im p o s ed u n d e r s ect i on 2 7 1 ( 1) ( b ) of t h e act . Th e r e f o r e, t h e s e w e r e n ot t h e ca s es o f si m p l e t ax ev as i on , b u t o f su s p ec t e d t a x 6 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia e va si on b y t r an sf e r rin g or k e ep in g fu n d s o v e rs e a s in an i llic it m an n e r . Th e p e r s on s wh o ar e su sp e ct e d of h avin g op en ed and m a in t ain e d u n d is cl o s ed b an k a c c ou n t s ov e r s ea s w e r e r eq u i r ed t o sig n t h e s e co n s en t let t er s t o v e ri f y t h e t ru t h of t h e a ll eg at ion s ag ain st t h em . Th e r ef o r e , it i s t h e d u t y o f e v er y cit iz e n t o c o op e ra t e wit h an d j oin in v est ig at io n t o as c e rt a in t h e t ru t h r eg a rd in g ca s es w it h su ch s e ri ou s al leg at i on s. Th e p u rp o s e o f t h e p an el p r o vi si on s i s t o en su r e c o m p li an c e t o t ax en q u i ry an d in v est ig at io n . H e t h e r e f or e h e ld t h at in t h e ca s e of t h e as s e s s e e, t h e r e w as an in f o r m at i on t h a t as s e ss e e is en g ag ed in su sp e ct ed t a x e va si on b y t r an sf e r rin g or k e ep in g fu n d s o v e rs e a s in an i llic it m an n e r . Th e as s e s s e e i s su s p e ct ed of h a vin g op en ed an d m aint ain e d u n d i s cl o s ed b an k a cc ou n t o v er s ea s an d w as r eq u i r ed t o sig n t h e c o n s en t f o rm t o v er if y t h e a ll eg a t i o n . Th e r ef o r e , a cc o r d in g t o t h e l ea rn ed c o m m i s si on e r A p p eal s , it is t h e d u t y o f t h e a ss e s s e e as a ci t iz en of In d i a t o co o p e rat e wit h an d j o in t h e in v est ig at io n . M e r e si g n in g o f t h e c on s en t f o rm d o e s n ot cau s e an y h a rm t o t h e a p p ell an t an d i f h is d en ia l of h a vin g op en ed a n y b an k a c c ou n t i s c o r r e ct , a s s es s e e h as n ot h in g t o w or r y. H o w ev e r , h e h eld t h at b u t r e fu sal t o sig n t h e c on s en t f o rm t an t a m o u nt t o r e fu s al t o j oi n t h e in v e st ig at i on it s el f. H e f u r t h e r h e ld t h at t h e p u rp o s e of t h e p e n al p r o vi si on s of s e ct i o n 2 7 1 ( 1) ( b ) o f t h e act i s t o en su r e c o m p lia n c e t o t a x in v e st ig a t i on an d , t h e r e f o r e, a s t h e ap p ell an t h a s f ail e d t o s ig n t h e c on s e n t f o rm an d h avin g n o r ea s on ab l e c au s e t o d o so h as v i olat e d t h e sai d p ro vi si on . H e f u rt h e r h eld t h at it i s im m at e ri al wh et h e r t h e a s s es s e e h as o p en ed an y b a n k a c co u n t an d i n d u lg e d in u n d i s cl o s e d t ran sa ct i on , t h at i s a f ac t t o b e v er ifi e d an d in v e st i g at ed , b u t r e fu s al o f t h e ap p ell an t to sig n the c on s e n t d o cu m en t is a d el ib e rat e r e fu sal to j oin the in v e st ig a t i on , fo r w h ich lia b ilit y t o p en al c on s e q u en c es a ri s es at t h i s v e ry st ag e it s el f. C on s eq u en t ly , h e c on f i rm e d t h e p en a lty l ev i ed b y t h e l ea rn ed as s e ss in g of fi c e r f o r a ll t h e s e y ea r s. Th e r ef o r e , a s s es s e e is ag g ri e ve d wit h t h e o rd e r of t h e l ea rn e d c o m m i s si o n e r ap p eal s h a s p r e f e rr e d ap p e al s b e f o r e u s f o r al l t h e s e s e v en as s e s sm en t y e a rs .
9. Th e h ea rin g s in the ca s e of the a p p eal s were fi xed fi rs t ly , on 1 8/ 9/ 2 0 1 8 on wh i ch d at e t h e ad j ou rn m en t wa s s ou g h t an d g ran t e d . Th e ca s e wa s fix e d fo r h e a rin g on 2 5/ 9/ 2 0 1 8 . On t h at d at e, al so a s s es s e e fil ed a p ap e r b o ok a n d ad d it io n al g r ou n d s an d fu rt h e r s ou g h t ad j ou rn m en t 7 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia o f h ea rin g . T h e c as e of t h e a ss e s s e e w as a d j ou rn ed an d fi n ally h e a rd on 2 7/ 9/ 2 0 1 8 .
1 0 . A l l t h e ad d it i o n al g r ou n d s a r e in fa ct a rg u m en ts o f t h e a s s es s e e , leg al in n a t u r e an d t h e r e f o r e t h o s e a r e ad m it t ed and a r e d e alt wit h in t h e arg u m en t s r ai s ed b y t h e ld A R .
1 1 . Th e l ea rn ed a u t h o ri s ed r ep r e s en t at iv e v eh em en t l y s u b m it t e d t h at t h e r e i s n o f ailu r e on t h e p a rt of t h e as s e ss e e in c o m p l yi n g an y o f t h e n ot i c e s i ssu e d b y t h e l ea rn e d a ss e s si n g of fi c e r , t h er e f o r e t h e p en a lt y le vi ed u / s 2 7 1 ( 1) ( b ) of t h e ac t f o r a ll t h e s e v en y ea r s is n ot su st ain a b l e. H e su b m it t ed h i s ar g u m en t s as u n d e r .
i. H e su b m i t t ed a d at e ch a rt an d su b m it t ed t h at t h e n ot i c e was is su ed on 1 8/ 7 / 2 0 1 3 t o s ig n t h e c on s e n t fo r m b y 2 2/7/ 2 0 1 3 . H e su b m it t ed t h at 2 1 st an d 2 2 J u l y 2 0 1 3 w er e h o lid ay s . H e f u rt h e r st at e d t h at a s s es s e e su b m it t ed a r ep l y on 2 3/ 7/ 2 0 1 3 . He su b m it t ed t h a t a s t h e r e p ly i s su b m it t e d b y t h e a s s es s e e , t h e r e is c o m p l et e c om p l ia n c e.
ii. A c c o rd in g t o h im fi r st n ot i c e u n d e r s e ct i on 1 4 3 ( 2) w a s is su e d on l y on 2 1/ 1 0/ 2 0 1 3 . Th er e af t e r t h e p en alt y wa s i m p os ed on 1 2/ 1/ 2 0 1 5 . A f t er t h e i s su e o f n ot ic e u n d e r s e ct i on 1 4 3 ( 2 ) an d u p t o t h e d at e o f im p o sit i on o f t h e p en a lt y , n o n o tic e s w er e is su ed at all in b et w e en these, two d at e s by the l ea rn ed as s e ss in g of fi c e r . T h e r e fo r e , ac c o rd in g t o h im t h e a ss e s s m en t p r o c e ed in g s on l y c om m en c ed f r o m t h at d at e i. e . 2 1 / 10 / 2 0 1 3 an d p ri o r t o t h at d at e, wh at e v e r in f o rm at i on w as s ou g h t f o r can n ot r e su l t in t o t h e p en alt y a s t h e p en a lt y c an on l y b e l e vi ed f or n on - co m p l ian c e d u r in g the c ou r s e of a ss e s s m en t p r o c e ed in g s .
iii. A c c o rd in g t o t h e p r ov is i on s of s e ct i on 2 7 3 B of Th e In c om e Ta x A ct , n o p e n alt y can b e l ev i ed , i f a s s es s e e sh ow s a r ea s on ab l e cau s e f o r fa ilu r e t o c o m p l y wit h t h e n ot i c e . A ft e r o b t ai n i n g t h e e xp la n at i on f r om t h e as s e s s e e, if t h e a s se s sin g of fi c e r fin d s t h a t t h e ex p lan at i on i s n ot s at i s fa ct o ry , t h e n on ly t h e p en alt y c an b e le vi ed . H e su b m it t e d t h at t h e a ss e s s e e h as su b m it t ed d u rin g t h e c ou rs e o f s ea r ch t h a t sh e d o e s n ot h a v e an y su ch a cc ou n t w it h a 8 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia f or e ig n b an k . It wa s al s o su b m it t e d t h at va ri ou s d et ail s p r o vid ed in f o r p o rt f oli o s b y t h e a s s es s in g o f fi c er in 3 p o rt f oli o s t h e n a m e of a s s e ss e e d o e s n o t ap p e ar an d in t h e 4 t h p o r t f oli o on l y in C H O TU MA N 2 1 . Th e n am e o f t h e a s s es s e e a p p ea r s an d t h at t o o a s a j oin t h old e r . I n t h e ci r cu m st an c e s , a s a s s e ss e e h as n ot h i n g t o d o wit h t h e b an k a cc ou n t st at ed b y t h e a s s e ss in g o ffi c e r . Th e a s s es s e e r e fu s ed t o si g n t h e c on s en t fo r m . Th is am ou n t s t o a r ea s o n ab l e cau s e s o n o p en alt y sh ou ld h av e b e en le vi ed u n d e r s e ct i o n 2 7 1 ( 1) ( b ) f o r n ot sig n in g t h e c o n s en t f or m b y t h e a s s es s e e .
iv. S h o w c au s e n o t i c e h as b e en i s su ed f o r in it iat i on o f t h e p e n alt y an d n o t f o r t h e l e v y o f t h e p en alt y . H e re f e r r ed t o n ot i c e d at e d 2 6/ 9/ 2 0 1 3 an d r e ad t h e su b j e ct t it l e wh ich in su b j ect lin e s h o ws t h at sh o w cau s e n o t ic e f o r in it iat i on of p en al t y p ro c e ed in g s. H e fu rt h e r st a t ed t h at n on - c o m p li an c e h as b e en st a t ed in p a ra n u m b e r 4 o f t h e a b o v e n ot ic e wh e r e it is m en t i on ed t h a t on v er ifi c at i on o f t h e o ffi c e r e c o rd s, i t w as n ot i c ed t h at t h e r e h a s b e en n o c o m p li an c e wit h t h e t e r m s o f t h e n ot i c e i ssu e d u n d e r s ec t i on 1 4 2 ( 1 ) of Th e In c om e T ax A c t d at ed 1 8/ 7/ 2 0 1 3 u p t o 2 2/ 7/ 2 0 1 3 as a s se s se e has n ot su b m it t ed the f o r eig n b an k ac c ou n t st a t em en t n o r f il ed a d u ly si g n ed c on s en t l et t e r . H e fu rt h e r su b m it t e d t h at t h er e i s n o e vi d en c e a vail abl e w h et h e r an y sat is fa ct i on w as r e c o rd ed b y A O b e f o r e i s su e of n ot i c e u n d e r s e ct i on 2 7 1 ( 1) ( b ) of t h e A ct o r n ot . H e su b m it t e d t h at ac c o rd in g t o t h e p r ov is io n s of s ec t i o n 2 7 4 u n d e r wh ic h t h e n ot i c e i s r eq u i r ed t o b e i s su ed , o n ly t ab le i s m en ti on ed b y h an d , an d n o sat i s fa ct i on wa s r ec o r d ed . H e fu rt h e r r ef e r red t o p a ra n u m b e r 5 o f t h e n o t ic e st at in g t h at it wa s w it h ou t sa t i sf a ct i on b y t h e a s s es sin g of fi c er ab ou t t h e d ef au lt o f t h e a ss e s s e e . H e fu rt h e r st at ed t h a t sat i s fa ct i on m u st b e d i s c e rn ib l e f r om t h e n ot i c e wh ich i s ab s en t in t h i s p a rt i c u la r ca s e . H e t h e r e f or e su b m it t ed t h a t in ab s en c e o f an y sat i s fa ct i on r ec o rd e d b y t h e le ar n ed as s e s sin g o ffi c e r ab ou t t h e fai l u r e o f t h e a s s es s e e , t h e p en alt y p r o c e ed in g s a r e in v alid .
v. Th at in the n ot i c e , a s s e ss e e w as n ot g iv en co p y of the in f o rm at i on a vai lab l e w it h a s s es sin g o f f ic e r. H e r ef e rr e d t o p ag e 9 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia n u m b e r 1 9 9 o f h i s p ap e r b o o k , wh i ch is an a s s e ss m ent o rd e r u n d e r s e ct i on 1 5 3A r ea d wit h s e ct i on 1 4 3 ( 3) o f t h e in c om e t ax act , 1 9 6 1 d at ed 2 7 / 3/ 2 0 1 5 an d su b m it t ed t h a t in f o rm at i o n wa s p r o vid ed in t h e a s s e ss m en t o rd e r it s el f. H e fu rt h e r r ef e r r ed t o p ag e n u m b e r 2 1 3 wh er e in p a ra n u m b e r 1 0 o f t h e a s s e ssm en t o rd e r , a s s es s e e h a s su b m it t e d b y l et t e r d at ed 2 0 J an u a r y 2 0 1 5 t h at t h e all e g ed b a n k s t at e m en t o f HS BC ac c ou n t s t at ed t o b e b el on g in g t o t h e a s s es s e e is n ot au t h e n t ic o r si g n ed b y t h e an y o f t h e of fi c e r s of t h e b an k o r an y c o m p et en t a u t h o rit y wh i ch as s e ss e e h a s al r e ad y d en i ed . H e t h e r e f o r e su b m it t ed t h at wh er e c op y o f t h e d o cu m e n t wa s p r o vid ed t o t h e a s s es s e e du rin g t h e as s e ss m en t p r o c e ed in g s , wh i ch c om m e n c e s on ly on 2 1 /1 0 / 2 0 1 2 b y i ss u e o f t h e n ot ic e , an d , t h e r e f or e , at t h e t im e o f al l eg ed d e fau lt , t h e r e w e r e n o p r o c e ed i n g s p e n d in g an d t h e ref o r e t h e p en alt y l e vi ed b y t h e l ea rn ed a s s e ss in g o ffi c e r i s i n va lid . vi. Th at t h e p en alt y is l evi e d as p e r t h e c o d if i ed la w wh i ch i s in c om e t a x a ct an d t h e l ea rn ed co m m is si on e r ap p e als h a s t alk ed ab ou t t h e m o r alit y wh i ch is l ea st c o n c e rn ed in t h e t a x law s. Th e r ef o r e , t h e c on fi rm at i on o f t h e p en a lt y b y t h e co m m i s si on e r ap p eal s in v ok in g t h e p rin cip l e s of m o r a lit y i s in v alid . vii . Th at t h e p rin cip l e o f n at u ral j u st i c e i s vi olat e d in t h is p ar t icu l a r ca s e , a s on ly sin g l e n ot ic e w as i s su ed b y t h e l ea rn e d A O a n d n o in f o rm at i on wa s en c lo s ed wi t h t h e n ot ic e .
viii . Th at t h e as s e s sm en t o r d er in t h e p r e s e n t c as e h a s b e en p as s ed on 2 7/ 3/ 2 0 1 5 . Th e p en al t y p r oc e e d in g s u n d e r s e ct i on 2 7 1 ( 1) ( b ) d o e s n ot h av e a n y r e f e r en c e t o t h e as s e ss m en t p r oc e e d in g s . Th e r ef o r e , the o ri g in al sh ow cau s e n ot i c e was is su ed on 2 6/ 9/ 2 0 1 3 , a cc o rd i n g t o t h e p r o vi si on s o f s e ct i on 2 7 5 ( 1 ) ( C) o f t h e i n c o m e t a x ac t , t h e p en alt y sh ou ld h a v e b e en le vi ed wit h in 6 m on t h s f r o m t h e en d of t h e y ea r in wh ich sh ow cau s e n ot i c e wa s i ss u ed . H e t h e r e f or e su b m it t ed t h at t h e sh o w c au s e n ot i c e i s i s su ed on 2 6/ 9/ 2 0 1 3 an d t h e y ea r en d ed on 3 1/ 3 / 2 0 1 4 an d t h e r ef o r e t h e p en a lt y sh ou ld h av e b e en l e vi ed on o r b e f or e 3 0/ 9/ 2 0 1 4 . In t h is p r e s en t ca s e , t h e p en a lt y h a s b een l ev i ed on 1 2/ 1/ 2 0 1 5 an d t h e r ef o r e the p en a lt y p r o c e ed i n g s are t im e b a rr e d .
10 MA Nos. 31 to 37/Del/2019Jayanti Dalmia ix . H e fu rt h e r su b m it t ed t h at d u rin g t h e as s e s sm en t p r oc e e d in g s , t h e l e a rn ed a s s es si n g o ffi c e r h i m s e lf wa s n ot su r e wh et h e r t h e ad d it i on is r eq u i r ed t o b e m ad e in t h e h an d s o f t h e a s s e ss e e o r n ot . H e fu rt h e r re f e r r ed t o t h e a ss e s s m en t o rd e r p as s ed in t h e ca s e o f t h e a s s e ss e e wh en t h e ad d it i o n h as b e en m ad e i n t h e h en c e o f t h e a ss e s s e e on p r ot e ct iv e b a s is .
x. H e fu rt h e r su b m it t e d t h at t h e t h r e e p e r s on s a r e in v o lv ed in t h i s ca s e a lo n g wi t h t h e as s e ss e e . Th e h u s b an d o f t h e a ss e ss e e a s w ell a s t h e el d e r b r ot h e r o f t h e h u s b an d o f t h e as se s s e e a r e als o in v o lv ed . N on e of the 3 persons were call e d for an d e xam in e d u rin g t h e c ou rs e o f t h e a s s e ss m en t p r o c e edin g s. H e fu rt h e r su b m it t ed t h at t h e p ag e n u m b e r 1 4, all eg e d st at em en t wh er e t h e n a m e o f t h e S an j a y D alm ia i n CH O TU MA N2 1 an d t h at d o cu m en t it s el f sh ow s t h at t h e r e is a m i s sin g m an n er o f t h e sig n at u r e. Th e r ef o r e , it was not su r e whether the a c c ou n t b el on g s t o t h e a ss e s se e o r n ot e v en a s p e r t h e u n d er st an d in g o f the l ea rn ed a s s es sin g of fi c e r h i m se l f. Th e r e f o r e, wh en the as s e ss in g o ff ic e r h im s e lf is n ot su r e wh et h e r the ac c ou n t b el on g s t o t h e a ss e ss e e o r n ot , t h e r e i s n o p u rp o s e a n d n o r ea s on t h at a ss e s s e e m u st sig n a c on s en t f o rm . H e ref e r r ed t o t h e p r ovi si on s o f s e ct i on 1 4 2 ( 1) of t h e in co m e t ax a ct an d st at e d t h at t h e p r ov is i on s of that s e ct i on d o e s n ot a sk an as s e ss e e to cr e at e a d o cu m en t or e vid en c e ag ain st him . Th e r ef o r e , b y a sk i n g f o r t h e c on s en t l e t t e r f r om t h e a s s e s s e e i s ask in g t h e a s se s s e e t o p r od u c e e vid e n c e a g ain st h er, w h ich is n ot p e rm it t ed b y t h e la w. H e fu rt h e r s t at ed t h at t h e a s s e s sin g o ffi c e r has as k ed the a s s es s e e to r en d e r a s si st an c e in the as s e ss m en t p ro c e ed in g s , b u t su ch a s si s t an c e c an n ot l ead t o t h e ask in g f o r in f o r m at i on .
xi . H e fu rt h e r st a t ed t h at t h e is su e in t h e ca s e o f S anj a y D alm i a wa s d i ff e r en t an d d o e s n ot a p p l y t o t h e fa ct s of t h e c a s e, as i n t h e p r e s en t c a s e, t h e a s s es s e e h a s sh o wn r e as on ab l e c au s e an d fu rt h e r t h e p r o vis i o n s o f t h e n a t u ral j u st i c e w e r e vi ol at e d . H e fu rt h e r su b m it t e d t h at in the ca s e of S an j a y D alm i a the h on ou ra b l e Hig h C ou rt wa s on the is su e of " P r ej u d i c e" . H ow e v e r, in t h e c a s e o f t h e as s e ss e e It is t h e q u est i on o f t h e 11 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia m o r alit y b a s ed on wh i ch t h e p en a lt y h as b e en c on fi rm ed b y t h e le ar n ed CI T ap p eal . H e t h er e f o r e su b m i t t e d t h at t h e ca s e o f M r S an j a y D al m ia m ay n ot b e ap p li ed t o t h e c a se o f t h e as s e s s e e . xii . H e fu rt h e r su b m it t e d t h at t h e ca s e of Mr Man i sh p e ri wal i s al s o d ist in g u i sh a b l e on f act s . I n t h a t ca s e a s se s s e e h as a c c ep t e d t h e b an k a c c ou n t in s e a r ch b el on g in g t o h i m an d t h en r et r a ct e d . H e su b m it t ed t h a t in t h e p r e se n t ca s e , t h e a s se s s e e is a c c ep t e d n eit h e r d u rin g s e a r ch n o r d u rin g t h e as s e ss m en t p roc e e d in g s t h at t h e b an k a c c ou n t b el on g s t o t h e a s s es s e e .
xiii . H e fu rt h e r r ef e r r ed t o t h e d ec isi on o f M r s su m an lat a Ban s al V s .
A CI T an d st at ed t h at in t h e p r e s en t ca s e, n o n ot i c e u n d e r s ec t i on 2 7 4 of t h e in c om e t a x a ct h as b e en is su e d by t h e as s e ss in g of fi c e r an d t h e r ef o r e the wh ol e of the p en a lt y p r o c e ed in g s a r e in v alid .
xiv . H e fu r t h e r r e f e r r ed t o t h e d e ci si on o f c o or d in a t e b en ch in ca s e o f A k h il B h a rat iy a Pr at h m ik S h i sk h an S an g h Bh av an Tru s t V s . A D IT [ 1 1 5 T TJ 4 1 9 ( D el h i) ] st a t in g t h at a s t h e a s ses s m e n t h as b e en m a d e u n d e r s e ct i on 1 4 3 ( 3) an d n ot u n d e r se ct i on 1 4 4 of t h e in c om e t ax a ct , m ean s t h at t h e s u b s eq u en t c om p lia n c e in the a ss e s sm en t p r o c e ed in g s wa s c on sid e r ed as a g o od c om p lian c e an d t h e d ef au lt c o m m i t t ed ea rli e r w e r e ig n o r ed b y t h e as s e s sin g o ffi c e r an d t h e r ef o r e t h e p en alt y u n d e r s e ct i on 2 7 1 ( 1) ( b ) c ou ld n ot b e l evi e d b y t h e a ss e s sin g offi c e r . H e su b m it t ed t h at a ss e ss m en t in t h e p r e s en t ca s e h as al s o b e e n m ad e u n d e r s e ct io n 1 4 3 ( 3) a n d n ot u n d e r s e ct i on 1 44 o f t h e act . Th e r ef o r e , t h e su b s eq u en t c o m p li an c e h as b e en m a d e b y t h e a ss e s s e e a r e a c ce p t ed b y t h e l ea rn ed A O an d , t h e r e f or e , t h e r e i s n o d e fau l t .
1 2 . Ba s ed on t h e a b o v e a rg u m en t , H e su b m it t ed t h at t h e p en alt y l e vi ed by the l ea rn ed as s e ss in g o ffi c e r an d c on f ir m ed by th e l ea rn e d c om m is si on e r of in c om e t a x a p p eal f o r all t h e 7 y e ar s d e s e rv e s t o b e d el e t ed .
1 3 . T h e l e ar n ed d e p a rt m en t al r e p re s e n t at i v e v eh em ent ly su b m it t ed an d su p p o rt e d t h e o rd e r s o f t h e l ow e r au t h o rit i e s . H e st a t ed t h a t 12 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia i. Is su e i s sq u a r ely c ov e r e d in fa v ou r o f t h e r e v en u e b y t h e d e ci si on o f t h e c o o rd in a t e b e n ch in c as e o f M r. M an ish P e riw al V s. D CI T ( I TA n u m b e r 5 1 5 7 - 5 1 6 2/ D el / 2 0 1 4) . H e fu rt h e r st at ed t h at t h e is su e is als o sq u a r ely c o v e r ed i n c as e o f r el at iv e of t h e a ss es s e e in t h e sa m e s e ar ch , s am e b an k a c co u n t an d sam e i s su e in ca s e of M r. S an j a y D al m ia v s t h e C I T [ IT A n u m b e r 3 7 9 5 - 3 8 0 1/ D el / 2 0 1 4] wh i ch h as b e en u p h eld b y t h e h on ou ra b le D elh i Hig h C ou r t an d t h e sp e cia l le av e p et i t i on b ef o r e t h e h on ou ra b l e S u p r em e C ou rt h a s als o b e en d i sm i s s ed . H e ext e n si v el y r ef e r r ed t o t h e d ec is io n o f M r . S an j a y D alm i a a n d st at e d t h at t h e p en alt y h a s b e en c on fi rm e d b y t h e h on ou r ab l e D elh i Hi g h C ou rt on t h e sa m e s et o f a c c ou n t s, s am e fa ct s, sa m e s e a rc h an d au t h o r ed by the A c c ou n t an t me m b e r, t h e r e f o r e t h at d e ci si on b in d s t h e I TA T an d t h e r e f ore sh ou ld b e f oll ow e d . H e fu rt h e r su b m it t ed t h at t h e fu t il e d i stin ct i o n of t h e o rd e r m ad e b y t h e l d . A R i s i r r el ev an t . H e fu rt h e r su b m it t e d t h at it is n ot t h e m e r el y t h e q u e st i on o f m o r alit y in t h e ca s e of t h e as s e ss e e b u t t o j oin t h e in v e st ig a t i on . I n t h i s ca s e , a ls o t h e r e i s n o p r ej u d ic e cau s ed t o a s s es s e e i f sh e sig n s t h e c on s en t l et t e r . H e als o su b m it t ed t h at it is n ot t h e ev id en c e ag ain st h er b u t if s h e d o e s n ot h old a n y s u ch al l eg ed b an k a c c ou n t , it i s in h e r f av ou r s o t h at in q u i ry can b e cl o s ed ag ain st h e r in fa v ou r of t h e a s se s s e e ab s o lvin g h e r .
ii. He fu rt h e r st at e d t h at the cl aim of the a s s e ss e e t hat the as s e ss m en t p r o c e ed in g s d id n ot c o m m e n c e u n l e s s t h e n ot i c e u n d e r s ec t i on 142 ( 1) of the in c o m e tax act has b e en i s su ed . He su b m it t ed t h at t h e as s es s m en t c o m m en c e s u n d e r s e ct i o n 1 5 3A of t h e in c om e t a x a ct as s o on a s t h e n o t ic e h a s b e en is su e d b y t h e le ar n ed a ss e s sin g o ffi c e r u n d e r t h at se ct io n , a s it i s a s ea r ch as s e ss m en t . H e fu rt h e r st at e d t h at t h e su ch n ot i c e h a s b e e n is su ed b y t h e l ea rn ed a s s es si n g o ff ic e r on 1 7/ 1 0/ 2 0 1 2 an d aft e r t h a t n ot i c e u n d e r s e ct i o n 2 7 1 ( 1 ) ( b ) w e r e i s su ed on 2 6 / 9/ 2 0 1 3 . H e al s o st at e d t h a t a s s es s e e c om m it t ed n on c o m p lia n c e o f t h e r e q u ir e m en t wa s al s o a n ot i c e u / s 1 4 2 ( 1) o f t h e a ct wh ich i s m en t i on ed in t h e let t er it s el f . Th e r ef o r e , t h e cla im o f t h e as s e ss e e t h at n o n o t ic e h a s b e en i s su ed d u rin g t h e co u r s e of a s s e s sm en t p r o c e edin g s i s d ev oi d o f an y m e ri t .
13 MA Nos. 31 to 37/Del/2019Jayanti Dalmia iii. H e fu r t h er su b m it t e d t h at p r ov isi on s o f s ect i on 2 7 5 ( 1) © d o e s n ot ap p l y t o t h e fa ct s o f t h e ca s e a s st a t ed b y t h e l ea rn ed a u t h o ri s ed r ep r e s en t a t iv e . H e su b m it t ed t h at t h e p en a lt y h a s b e en le vi ed in t im e by the as s e s sin g of fi c e r. He fu rt h e r st at ed t hat no su ch arg u m en t has been rai s ed by the a s se s s e e b ef o r e the lea rn ed as s e ss in g o f fi c e r o r b e f or e t h e l e a rn e d c om m is si on er o f ap p eal s . E v en ot h e r wi s e, h e su b m it t ed t h at t h e p en alt y o rd e r p as s e d b y t h e le ar n ed a s s e ssi n g o ffi c e r is n ot b a r r ed by the lim it at ion . He su b m it t ed t h a t t h e as s e ss m en t or d e r is p a ss e d on 2 7 / 3/ 2 0 1 5 an d t h e p en al t y o r d er h as b e en p as s ed on 1 2/ 1/ 2 0 1 5 , i .e. b e f or e t h e as s e ss m en t i s c o m p let e d s o it i s wit h in t h e t im e all ow e d b y t h e ac t u n d e r s ec t i on 2 7 5 ( 1 ) ( c) of t h e A ct .
iv. H e fu rt h er r e f e rr e d t o t h e p ag e n u m b e r 2 3 2 o f t h e pa p e r b o ok wh i ch c on t ain s the s t at e m en t r e c o r d ed of the as s e s se e on 5/ 1 2/ 2 0 1 4, wh e r e t h e d o cu m en t s s e iz e d d u rin g t h e c ou r s e o f s e a rch w er e s h o wn t o t h e a s se s s e e . Th e r ef o r e , it c an n ot b e st at e d t h at t h e d o cu m en t s were sh own to the as s es s e e in the as s es s m en t p r o c e ed in g s on l y. H e su b m it t ed t h at t h e a ss e s s e e wa s a wa r e ab ou t t h e i s su e f o r wh i ch t h e s ea r ch t o ok p la c e an d f o r th e p u rp o s e o f t h e is su e o f n ot i c e u n d e r s e ct i on 2 7 1 ( 1) ( b ) of t h e a ct . Th e r e f o r e, n o w t h e a s s es s e e c an n ot say t h a t sh e w as n ot a wa r e o f th e in f o rm at i on , as it w as n ot p r o vid ed t o t h e a ss e s s e e. It wa s wit hin t h e k n ow l ed g e of the a s s es s e e e v en at the t im e of the s e a rc h . He fu rt h e r su b m it t ed t h at in o t h e r t w o p e r s on s S h ri S an j a y D ala m ia an d S h ri A n u r ag D ala m ia , t h e is su e h a s r ea ch ed at t h e I TA T an d su p r e m e c ou rt st ag e an d t h e r e f or e , a s s es s e e c an n ot f e ig n ign o ran c e . v. H e fu rt h e r st at ed t h at it is al s o t h e cla i m o f t h e l ea rn e d au t h o ri s ed r ep r e s en t a t iv e t h at 4 d a y s t i m e wa s p r ov id ed t o t h e as s e s se e . H e st at e d t h at i f t h e 4 d ay s t im e w a s f ou n d sh or t b y th e a ss e s se e , t h e b e st c ou r s e w ou ld h av e b e en t o s e e k ad j ou rn m en t . N o ad j o u rn m e n t wa s s ou g h t b y t h e as s e s s e e d u rin g t h at t i m e. I f t h e a s se s s e e wan t ed m o r e t i m e t o su b m it t h e d et ai l, t h en a p r op er ap p lic at i on f or ad j ou rn m e n t s h ou l d have b e en ad d r e ss e d to the as s e ss in g o ffi c e r an d h e w as su r e t h a t t h e l ea r n ed as s e s sin g o ffi c e r m ig h t h av e c on sid e r ed t h e s am e in t h e m o st j u d ici ou s m a n n er . H e st at ed t h at a s s e ss e e i s n ei t h e r ap p l i ed f o r t h e ad j ou rn m en t an d n o r e v en 14 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia ap p r oa ch ed t h e a ss e ss in g of fi c e r fo r e x t en si on o f th e t i m e. H e a ls o r e fe r r e d t o t h e l et t e r su b m it t ed on 2 3/ 7/ 2 0 1 3 wh ich e v en d o e s n ot g iv e an y h in t t h at as s e ss e e w an t s m o r e t im e . Th e r efo r e , n o w t h i s p le a in t h e p en alt y p r o c e ed in g s i s j u st t o a v oid l ev y o f t h e p en al t y . H e fu rt h er st at ed t h at in ab s en c e o f an y p l ea b y t h e a ss e s s e e t h e r e is n o vi ola t i on o f ru l e s o f n at u r al j u st ic e .
vi. Wit h r e sp e ct t o t h e cl aim o f t h e l ea rn ed au t h o ri s ed r e p r e s en t a t iv e t h at on i s su e o f t h e n o t i c e t h e r e w as n o sat i s fa ct i on r e c o rd ed b y t h e a s s es si n g o ff ic e r ab ou t t h e f ailu r e o f t h e a s s ess e e , H e re f e r r ed t o p a r a n u m b e r 5 o f t h e n ot i c e , t h at p r op e r s at i sf ac t i on h as b e en r e c or d ed b y t h e l ea r n ed a s s e ss in g of fi c e r an d t h e r ef o r e it c a n n ot b e st at e d t h at a s s es si n g o f fi ce r h a s n ot r e c o rd ed sa t is f act i on p r io r t o t h e i s su e o f t h e n ot i c e.
vii . Wit h r e sp e ct t o t h e p r o vis i on o f in f o r m at i on t o t h e as s e s se e , h e su b m it t ed t h at p a ra n u m b e r 2 of t h e l et t e r d at ed 1 8/ 7/ 2 0 1 3 g iv e s t h e c om p l e t e in f o r m at i on an d s ou r c e t h e a cc ou n t n u mb e r , b an k ac c ou n t , et c et e ra . S o , n o fu rt h e r in f o rm at i on wa s a va il ab l e wit h t h e a ss e s sin g of fi c e r an d t h e c om p l e t e in f o rm at i on a vail ab l e wit h A O w as p r o vid ed t o t h e as s e s s e e. H e f u rt h e r s t at ed t h at t h e wh ol e st o ry i s l ik e t h i s t h at ev en as s e s sin g o ffi c e r d id n ot h av e t h e c om p l et e in f or m at i o n an d t h e r e f or e h e r eq u e st ed t h e a s s e ss e e f o r t h e p u rp o s e of sig n in g o f t h e c on s en t let t e r wh ich a s s e s se e h as r e fu s e d t o s ig n . Th i s it sh ow s t h at t h e r e i s n o b ona fid e in t en t i on o f the as s e s s e e. Ot h e rw is e , there is no p r ej u d ic e c au se d to the as s e ss e e in sig n in g t h e c on s en t f o r m . T h e c on s en t fo rm w o u ld h a v e g iv en a cl e a r- cu t p ict u r e wh et h e r t h e ass e s s e e is ha vin g a b an k ac c ou n t o r n o t . I f t h e a s s es s e e i s n ot h avin g a b ank a c c o u n t , wh ich is p l ead e d b y t h e a s se s s e e f r om t im e a n d ag ain , t h er e is n o r e as on t h at t h e a ss e s s e e h as n o t s ig n ed t h e c on s en t f o rm . H e t h e r e f o r e su b m it t ed t h at t h e ex p lan at i on fu rn i s h ed b y t h e a s se ss e e i s al s o n ot b on a f id e b e cau s e a s s es s e e d o e s n o t wan t t o c o op e ra t e wit h t h e as s e ss in g o f fi c er t o r ea ch at t h e t ru t h .
viii . He su b m it t ed t h at wh ol e p r o c e ss w as for the b e n efi t of the as s e ss e e . N am e o f t h e a s s es s e e h a s cr o p p ed u p in in f o rm at i on r e c eiv e d f r om a f o r eig n c ou n t ry an d t h e r ef o r e it w as n e c e s sa ry t o cl ea r t h e n a m e o f t h e as s e s s e e w h et h e r su ch in f o rm at i on i s c o r re ct 15 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia or not. In t h is w h ol e p r o c es s of the In c om e tax D ep art m en t , as s e ss e e wa s n ot s u p p or t in g / c o op e r at in g t h e A O . He s u b m it t e d t h at a s s es s e e h a s n ot ev e n sa id a sin g le wo r d ab ou t t h e d if fi cu lt y fa c ed b y t h e a s s e s s e e i s s ig n in g t h e c on s e n t f o r m . T i s sim p ly a b lu n t d en ial t o co o p e r at e. Th e r e f o r e, t h e r e i s n o rea s on ab le c au s e f or n on co m p l ian c e.
ix . H e fu rt h e r su b m it t e d t h at t h e n ex t g r ou n d o f t h e l ea rn ed au t h o ri s ed r ep r e s en t a t iv e i s t h at n o p en alt y can b e l ev i ed wh er e t h e r e i s n o ad d it i on in t h e c ou r s e o f a s s e ss m en t p r o c e ed in g s . He su b m it t ed t h at t h is p l ea of t h e l e a rn ed au t h o ri s e d r e p r es en t at i v e i s in c o r r ec t an d t h e r e i s a p r ot e ct i v e ad d it i on in t h e h an d s o f t h e a s s e s se e an d t h e r e i s an in c o m e. It i s n ot a c a se o f N il a d d it ion .
x. H e al s o su b m it t e d t h at it is in c om p r eh e n sib l e t h at wh y t h e as s e ss e e is t h in k in g t h at sig n in g of f o rm i s c r ea t in g evi d en ce ag ain st h e r . It is su b m it t ed t h at wh en t h e as s e s s e e is s o su r e t h at t h e ac c ou n t d o e s n ot b el on g t o h e r, it i s n o t e vi d en c e ag ain st h e r b u t in h e r fa v ou r an d wil l ab s o lv ed h e r f r om al l t h e fu t u r e p ro c e ed in g s. xi . H e fu rt h e r su b m it t e d t h at o r d er i s p a s s ed u / s 1 4 3 (3) o f t h e a ct .
Th e a s s e ss e e h a s n ot m a d e su b s eq u en t c o m p li an c e b y su b m it t i n g c on s e n t f o rm e v en t ill t o d at e , t h e r ef o r e it i s n ot m an d at o r y t o p a s an o rd e r u / s 1 4 4 of t h e a ct f o r in it i at in g p en al t y u / s 2 7 1 ( 1) ( b ) of t h e A ct .
1 4 . In vi ew o f t h e ab ov e f a ct s, t h e l e arn e d d ep a rt m en t a l r ep r es e n t at i v e v eh em en t l y su p p o rt ed t h e o rd e r of t h e l ow e r au t h o rit ie s an d su b m it t ed t h at t h e p en al t y h a s b e en rig h t l y l ev i e d b y t h e l ea rn ed as s es si n g o f fi c er an d c on fi rm e d b y t h e l ea rn ed Co m m is si on e r A p p e al s.
15. In r ej oin d er , the l e ar n e d au t h o ri s ed r ep r e s en t at iv e v eh e m en t l y su b m it t ed t h at n ot i c e u / s 1 5 3A i s su ed d o e s n ot m e an t h at t h e a s s e ss m en t p r o c e ed in g s w e r e st art e d . H e st a t ed t h a t n ot i c e u n d er s e ct i on 1 5 3A o f t h e in c om e t ax act i s a m e r e l et t e r a sk in g as s es s e e t o fu rn is h t h e r et u rn of in c om e . After the re t u rn of in co m e is fu rn i sh ed the a ss e s sm en t p r o c e ed in g s st a rt s , n ot p ri o r t o t h at .
1 6 . H e f u r t h e r r e f e r r ed t o t h e p r o vis i on s o f a rt ic l e 2 0 of t h e C on st i t u t i on t h at n o p e r s on sh all b e lia b l e t o p r od u c e in fo r m at io n ag ain st h im .
16 MA Nos. 31 to 37/Del/2019Jayanti Dalmia 1 7 . W e h a v e ca r ef u lly c on s id e r ed t h e r ival c on t en t i on an d als o p e ru s ed t h e o rd e r s of t h e l o w er au t h o rit i e s . Th e on l y is su e in v ol v ed in t h is a p p eal is t h at a s s e ss e e w a s is su ed n ot i c e u n d e r s e ct i on 1 42 ( 1) o f t h e in c o m e t a x act , 1 9 6 1 on 1 8/ 7 / 2 0 1 3 an d t h e d at e fix e d f o r t h e c om p lian c e w as 2 2/ 0 7 / 2 0 1 3 . Th e a b o v e n ot i c e is p l ac e d at p ag e n u mb e r 1 an d 2 o f t h e p ap e r b o ok . A c c o r d in g to t h at n o t ic e , the l ea rn ed a s s es si n g of fi c e r in f o rm ed t h e a s s es s e e t h at a s s e ss e e h a s b e en is su ed n ot i c e u n d e r s e ct i on 1 5 3A o f t h e act on 1 7/ 1 0 / 2 0 1 2 an d fu r t h e r q u e st i on na i re wa s a ls o i ss u e d on 2 6/ 1 1/ 2 0 1 2 an d n ot ic e u n d e r s e ct i on 1 4 2 ( 1) wa s al s o i s su ed o n 6/ 5 / 2 0 1 3 . Wit h r e sp e c t t o t h e ab ov e su b j e ct t h e l e ar n ed A O fo u n d t h a t a s p e r t h e in f o rm a t i on av aila b l e wit h t h e r e v en u e, a s ses s e e is h av in g an ac c ou n t in H on g K o n g an d S h a n g h ai b a n k in g C o rp , G en ev a , S w it z e rlan d . Th e l ea rn ed as s e s si n g o ffi c e r a ls o in f o rm e d t h e re l ev an t c od e of t h o s e ac c ou n t s . Th e l e a rn ed as s e s sin g of fi c e r in p a ra n u m b e r 3 o f t h e n ot i c e st at e d t h at HS BC b an k h a s d e cid ed t o s en d t h e c op i es o f t h e d oc u m en t s su ch as ac c ou n t o p en in g f o rm , c o p y of p as sb o ok , t ran sa ct i on d et ail s , in st ru ct i on s f r o m a c cou n t h o ld e rs an d ale rt r ec e iv ed b y t h em t o t h e r e sp e ct i v e a cc ou n t h old e r s in r e sp e ct o f all t h e Ind i an a c cou n t h old e r s m ain t ain in g a c c ou n t s wi t h t h em , e it h e r a s t h e a cc oun t h old e r o r as b en e fi cia r y . Th e r ef o r e , a s s e ss e e b ein g on e o f t h e all eg ed a c cou n t h ol d e rs in HS B C b an k m i g h t h a v e r e c eiv e d a ll t h e r e l eva n t d e t ail s a s st at ed ab ov e . Th e r ef o r e , t h e l ea rn ed a ss e s sin g o f fi c er r equ e st ed t h e a ss e s s e e t o fu rn i sh c e r t ain d e t ail s. In P a ra Nu m b e r 4 o f t h e l et t e r , t h e as s e s sin g o ffi c e r fu rt h e r s t at e d t h a t in c a s e t h e as s e ss e e d oe s n ot h av e t h e b an k ac c ou n t st at em en t , then to fu rn i sh d u ly fil l ed up s ig n ed , n ot a riz ed c on s e n t l et t e r s o t h at t h e a ss e s sin g o ffi c e r can h elp t h e a s s es s e e t o ob t ain t h e a c c ou n t st at e m en t f ro m t h a t p a rt i cu la r b an k . A lon g wit h t h e let t er , t h e l ea rn ed ass e s sin g of fi c e r f u rt h e r su b m i t t ed t h e c o p y of t h e c on s e n t le t t e r f o r t h e s ig n at u r e of t h e ass e s s e e . Th e l ea r n ed a s s es sin g o ffi c e r fu rt h e r d i r e c t ed t h e a s s e ss e e t o at t en d t h e of fi c e o n 2 2/ 7 / 2 0 1 3 at 1 1 . 3 0 a .m . al on g w it h t h e ab o v e- m en t i on ed in f o rm at i on . T h e l e ar n e d A O fu rt h e r st at ed t h a t n o fu rt h e r a d j ou rn m en t w ill b e g ran t ed an d t h e ab ov e m en t i on ed in fo r m at ion i s r eq u i r ed u n d e r s e ct i on 1 4 2 ( 1) o f t h e in c om e t ax a ct an d in ca s e of n on - c om p l ian c e p en al p r o vi si on s in t er m s of p en alt y/ p r o s ecu t i on under the in c om e tax a ct m ay be in v ok ed . Th e as s e ss e e su b m it t e d r ep l y t o t h at l et t e r on 2 3/ 7/ 2 0 13 vid e l et t e r d at ed 17 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia 2 2/ 7/ 2 0 1 3 . Th e m a in c on t en t i on o f t h e as s e s s e e i s th at sh e d o e s n o t h av e an y c on n ec t i on w it h an y of the a ll eg ed b an k acc ou n t s an d t ra n s ac t i on s d et ail e d in t h e n ot i c e an d d en y t h at an y of t h e s e a c c ou n t s o f t ra n s ac t i on s o r a c c ou n t s b el on g t o h e r . S h e fu rt h e r st at e d t h at sin c e t h e t ra n s ac t i on ac c ou n t s o r a c co u n t s d o n ot b el on g t o he r , t h e r e is n o q u e st i on o f h e r r e c ei vin g an y in f o rm a t ion f ro m HS B C b a n k s , S w it z e rlan d b e cau s e h e r su b m it t in g an y of t h e d et a i ls cal l ed for in t h e ab ov e r e f e rr e d let t er an d al s o sig n in g an y c on s en t l et t e r in t h is r eg a rd . Th e r ef o r e it i s ap p a r en t f r om t h e a b o v e r e p ly fil ed b y t h e a s s e ss e e l at e b y on e d ay t h at sh e d o e s n ot h av e an y su ch a c c ou n t a n d sh e d o es n o t w a n t t o s ig n an y c on s e n t l et t e r in t h is r eg a rd . Th e r e f o r e t h e l ea rn ed a s s es si n g o f fic e r n ot ed t h at on t h e a p p o in t ed d at e on 2 2 / 7/ 2 0 1 3 n o r ep l y w as fu rn i sh ed b y t h e as s e s s e e an d v id e l et t e r d at ed 2 2 / 7/ 2 0 1 3 su b m itt ed on 2 3/ 7/ 2 0 1 3, as s e ss e e d id n o t s u b m it an y in fo r m at ion an d al s o n ot s u b m it t e d t h e c on s e n t l et t e r . Th e r e f or e on t h e ap p oin t ed d at e , t h er e i s a n on c om p lian c e b y t h e a ss e s s e e. F u rt h e r , in su b st an c e t h e a s s e ss e e ev e n o n 2 3 J u ly 2 0 1 3 h as n ot c o m p li e d w it h t h e n ot i c e . Th e r e f or e on 2 0 / 9/ 2 0 1 3 , Th e l ea rn e d as s e ss in g of fi c e r i s su ed a sh o w cau s e n ot i c e f o r init i at i on o f p en al t y p r o c e ed in g s u n d er s e ct i on 2 7 1 ( 1) ( b ) o f t h e in c om e t ax a c t wit h r e sp e ct t o as s e s sm en t y e ar 2 0 0 6 - 0 7 t o 2 0 1 2 - 1 3 . Th e l e a rn ed a s se s sin g of fi c e r in t h at n ot ic e h a s sp e ci fi call y m en t i on ed t h a t n ot ic e u n d e r s e ct i on 1 4 2 ( 1) o f t h e in c om e t ax a ct , 1 9 6 1 w as i s su ed on 1 8/ 7/ 2 0 1 3 an d d at e w a s fix e d f o r t h e c om p l i an c e wa s 2 2/ 7/ 2 0 1 3 . In p a ra n u m b e r 3, T h e l ea rn ed as s e ss in g o ffi c e r h as al s o n ot ed t h at as s e s s e e w as re q u ir ed t o fu rn i sh f or e ig n b an k ac c ou n t st at em en t an d in ca s e t h e a s s es s e e d o e s n ot h a ve t h e b an k a c c ou n t s t at em en t , t o f u r n is h d u l y fill ed u p si g n ed n ot a riz e d c on s e n t le t t e r by 2 2/ 7/ 2 0 1 3 . On v e r ifi cat io n of the r e c o rd s of the as s e ss in g o ffi c e r , it wa s n ot e d b y h i m t h at t h e a sse s s e e h a s n ot c o m p li e d wit h t h e n ot i c e u n d e r s e ct i on 1 4 2 ( 1 ) o f t h e in c om e t ax ac t b y n ot su b m it t in g c op i e s of the b an k a cc ou n t an d als o the c on s en t l et t e r . Th e r ef o r e in p ar a n u m b e r 5 o f t h at n o t ic e t h e a s s essin g of fi c er n ot ed t h e sat is fa ct i on t h at a s s es s e e h a s fail e d t o c om p ly wi th t h e t e rm s o f n o t ic e u n d e r s e ct i on 1 4 2 ( 1) o f t h e in c om e t a x a ct an d t h er e f o r e t h e a s s e ss e e wa s i s su ed a sh ow cau s e wh y a p en alt y of ₹ 1 0, 0 0 0 sh ou ld n ot b e im p o s ed u p on h e r u n d e r s e ct i on 2 7 1 ( 1) ( b ) of t h e in c o m e t a x act f o r failu r e t o c om p ly w it h t h e t e r m s o f t h e n ot i c e i ss ue d u n d e r s e ct io n 1 4 2 18 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia ( 1) of t h e a ct . Th e n ot i c e fi x ed t h e d at e of h e a ring on 3 0/ 9/ 2 0 1 3 on wh i ch d a t e t h e a s s e ss e e fi l ed a l et t e r wh e r ein it ha s b e en st at ed t h at as s e ss e e h a s al r e a d y c o m p li ed wit h t h e n ot i c e d at ed 1 8 J u ly 2 0 1 3 f o r wh i ch the r ep ly h as al r e ad y b e en s u b m it t e d on 23 J uly 2013. Th e as s e ss e e al s o st at e d t h at t h e r e b ei n g a c om p l et e c om p lia n c e of t h e s aid n ot i c e t h e r e i s n o r e as on f o r i ssu e o f an y n ot i c e un d e r s e ct i on 2 7 1 ( 1 ) ( b ) o f t h e in c o m e t ax A ct . Th e l e arn e d a s s e s sin g o ff ic er n ot sat is fi ed wit h t h e r ep l y fil e d b y t h e a s se s s e e d at e d 2 3/ 7 / 2 0 1 3 a s w el l as t h e exp lan at i on su b m it t ed b y t h e as s e ss e e in h ea rin g on 3 0/ 9/ 2 0 1 3, l e vi ed a p en alt y u n d e r t h at s e ct i on o f ₹ 1 0 ,0 0 0 f o r ea ch o f t h e y ea rs . Th e ab ov e o rd e r w a s ch al l en g ed b e f or e t h e l ea rn e d c om m i ss ion e r of in c om e t ax ap p eal s , wh o c on f ir m ed t h e p en a l t y fo r all t h e 6 y ea r s. N o w w e d eal wi t h e a ch of t h e c on t en t i on s rai s ed b y t h e l d A R .
1 8 . Th e 1 st c on t e n t ion o f t h e l ea rn ed au t h o ri s ed r ep r e s e n t at i v e i s t h a t as s e ss e e h a s c om p l ied wi t h t h e n ot ic e d at ed 1 8/ 7 / 2 01 3 b y su b m it t i n g a let t er d at ed 2 2/ 7/ 2 0 1 3 on 2 3/ 7 / 2 0 1 3 in the of fi c e of the l ea rn e d as s e ss in g of fi c e r. T h e sai d l et t e r h a s b e en p la c ed at p ag e n u m b e r 3 of t h e p a p er b o ok . On ca r e fu l p e ru s al o f t h e ab o v e sai d l e t t e r , it i s ap p a r en t t h at t h e a ss e s s e e h as d en i ed t h at sh e d o e s n ot h av e an y b an k a c c ou n t as st at e d b y t h e le a rn ed a s s es sin g o ffi c e r an d t h e r ef or e sh e r e fu s e d t o s ig n an y c on s en t l et t er i n t h is re g a rd . Th e n ot i c e u n d e r s e ct ion 1 4 2 ( 1) o f t h e in c om e t a x a ct st at ed t h a t i f sh e d o e s n ot h a v e b ank s t at e m en t ac c ou n t , t h en t h e l ea rn ed a s s es si n g o ff ic e r wi ll h el p t o ob ta in t h e s t at em en t fr o m t h o s e b an k s . A s s e s s e e d id n ot g iv e t h at c on s en t l ett e r . In cas e i f t h e as s e ss e e d o e s n ot h av e an y b an k a c c ou n t , t h en on sub m it t i n g t h e c on s en t let t er t h e t ru t h w o u ld h a v e c om e ou t t h at as s e s s e e d o e s n ot h av e an y b an k ac c ou n t , b u t b y n on su b m it t i n g o f t h e co n s en t l et t e r wa s cl ea r n o n c om p lian c e of t h e l et t e r d at ed 1 8/ 7/ 2 0 1 3 b y t h e a sse s s e e . F u rt h e r, on 3 0/ 9/ 2 0 1 3, a s s es s e e in r e sp on s e t o n o t ic e u n d e r s e ct i on 2 7 1 ( 1) ( b ) o f t h e in c om e t a x a ct su b m it t ed t h at t h er e b ein g co m p l e t e c o m p lia n c e of t h e sai d n ot ic e . On p e r u sal of t h e r ec o rd , A O n ot ed t h at it i s ap p a r en t t h at t h e a ss e s s e e h a s n ot c om p li ed wit h t h e n o t i ce b y n ot su b m it t in g t h e c on s e n t f o rm f o r o b t ain in g t h e b an k ac c ou n t s t at e m en t wit h r e sp e ct iv e n u m b e rs st at e d b y t h e a ss e s sin g of fi c e r t o t h e a s s ess e e . H en c e ac c o rd i n g t o u s t h e r e i s n o c o m p lia n c e b y t h e as s e ss e e .
19 MA Nos. 31 to 37/Del/2019Jayanti Dalmia 1 9 . Th e 2 n d c on t en t ion o f t h e l ea rn ed a u t h o ri s ed r ep r e s en t at iv e wa s t h a t 1 st n o t i ce u n d e r s e ct i on 1 4 3 ( 2) wa s is su ed on ly on 2 1 / 1 0/ 2 0 1 3 an d p en alt y wa s im p o s e d on 1 2/ 1/ 2 0 1 5 . It wa s st at ed t h a t as t h e a s s es s m en t p r o c e ed in g s b eg in s on l y on t h e i ssu e o f n ot i c e u n d er s e ct i on 1 4 3 ( 2) o f t h e in c o m e t a x ac t , i. e . on 2 1/ 1 0 / 2 0 1 3 , t h e p e n alt y n ot i c e is su ed b y t h e le ar n ed a ss e s sin g o ffi c e r on 2 6/ 9/ 2 0 1 3 is n ot val id. W e h av e c a r efu lly p e ru s ed t h e r el e van t r e c o rd s p la c ed b e f or e u s . A s p e r p a g e n u m b e r 1 of t h e p ap e r b o ok , a s s e ss e e h a s p la c ed t h e l e t t e r d at ed 1 8/ 7/ 2 0 1 3 , wh e r e it is m en t io n ed t h at t h e n ot i c e u n d e r s e ct i on 1 5 3A h a s b e en i ss u ed on 1 7/ 1 0 / 2 0 , fu rt h e r q u e st i on n ai r e i s is su ed t o t h e a ss es s e e on 2 6/ 1 1/ 2 0 1 2 an d n ot ic e u n d e r s e ct i on 1 4 2 ( 1) w as i s su ed o n 6 / 5/ 2 0 1 3 . Th e r ef o r e , t h e arg u m en t of the l ea rn e d au t h o ri s ed re p r es en t at i v e th at as s e s sm en t p r o c e ed in g s b eg u n on l y on 2 1/ 1 0/ 2 0 1 3 is d ev o id o f an y m e rit . A c c o rd in g t o t h e p r o vi si on s o f s e ct i on 2 7 1 ( 1) ( b ) if t h e a sse s s e e h as fai l ed t o c om p ly w it h t h e n o t ic e i ssu e d u n d e r s e c t ion 1 4 2 ( 1) o f t h e in c om e t a x a ct t h an t h e as s e s s e e m ay b e d i r e ct ed b y t h e l ea rn ed a ss e ss in g o ffi c e r t h a t h e sh a ll p a y b y w a y of a p en a lt y a s u m o f ₹ 1 0 ,0 0 0 f o r ea ch o f su ch failu r e . Th e l et t e r d at ed 1 8/ 7/ 2 0 1 3 , as per p a ra number 5 c l ea rl y m en t i on ed that the ab o v e in f o r m at i on is r e q u i r ed by the l ea rn ed as s e ss in g of fi c e r u n d e r s e ct i on 1 4 2 ( 1 ) o f t h e i n c o m e t ax act , 1 9 6 1 . Th e r ef o r e it is ap p a r en t t h a t t h e a b ov e n ot i c e d at ed 1 8/ 7/ 2 0 1 3 w as is su ed u n d er s e ct i o n 1 4 2 ( 1) o f t h e i n c om e t a x a ct an d fai lu r e t o c o m p l y wit h t h e said n ot i c e i n vit e s p en al t y u n d e r s e ct i on 2 7 1 ( 1) ( b ) of t h e in c om e t ax a ct . H en c e, w e r ej e ct t h i s a r g u m en t o f th e ld A R .
2 0 . Th e n ex t a rg u m en t o f t h e l e ar n e d au t h o ri s ed r ep r es en t at i v e is t h at t h at the p r o vi si on s of s e ct i on 273B p r o vid e s t h at no p en alt y under s ec t i on 2 7 1 ( 1) ( b ) can b e l e vi ed i f t h e a s s es s e e sh ow s t h at t h e d ef au lt wa s for the r ea s on a b l e c au s e . Th e as se s s e e has not sh own an y r ea s on a b l e cau s e f o r n ot c om p l yin g wit h t h e n ot i c e d a t ed 1 8 / 7/ 2 0 1 3 b e f o r e A O . Th e a s s e s se e h a s flat ly r e fu s ed st at in g t h at a ss e s se e d o e s n ot h av e an y su ch a cc o u n t s o r t h e r e i s n o q u est i on of sig n in g an y c on s en t let t er in t h is r eg a rd . Th at l et t e r wa s al s o su b m it t ed on 2 3 / 7 / 2 0 1 3 an d n ot on t h e ap p oin t ed d a t e on 2 2/ 7 / 2 0 1 3 . T h e a s se s s e e al s o d i d n ot ap p ly f o r an y ad j ou rn m en t o n t h os e d at e s . F u r t h e r i f t h e a s s ess e e d oe s n ot h av e an y b an k a c c ou n t , t h en t h e as s e s s e e s h ou l d h a v e su bm it t ed t h e c on s en t 20 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia let t er . N o p r ej u d i c e wou l d h av e cau s ed t o t h e a ss e ss e e. F u rt h e r b y n o t su b m it t in g t h e c on s en t a s s es s e e h a s p u t h e r s elf in g r ea t e r d i ffi cu l t y a s p en al p r oc e ed in g s w er e in i t iat e d as w e ll as a s s es sm en t h a s al s o m ad e on h e r on p r o t ect iv e b asi s . F u rt h e r , b y n o t su b m it t in g t h e c o n s en t l e t t e r t h e as s e ss e e h a s n ot p r ov e d h e r b on a f id e , b u t h ad c r ea t e d an im p r e s si on t h at sh e wan t s t o s t all an y en q u i r y b y t h e r e v en u e wit h r e sp e ct t o t h o s e ac c ou n t s wh er e t h e n am e o f t h e a s s es s e e is m en t i on ed . A s p e r t h e in f o rm at i on av aila b l e , wh i ch i s p la c ed at p ag e n u m b e r 1 4 t o 1 9 o f t h e p ap e r b o o k , it i s a p p a r en t t h at t h e n a m e o f t h e a s ses s e e is sp e ci fi call y m en t i on ed in p a r t - A of t h e st at e m en t wh i ch cl e a rly sh ow s t h at as s e s s e e h as s o m e c on n e ct i o n wit h t h at b an k a c c ou n t . F u rt h e r, t h e n am e o f t h e 2 r ela t iv e s o f t h e a ss e ss e e w e r e al s o m e n t ion e d in t h e sam e b an k a c c ou n t t h at cl ea rl y sh ow s t h at as s e s s e e h a s s om e c on n e ct i on wit h t h at b an k ac c ou n t . Th i s in f o r m at i on wa s al r ead y av aila b l e with t h e as s e ss e e at t h e t im e o f s ea r ch al s o h o w ev e r , as s e s s e e t o s t all t h e en q u ir y b y t h e l ea rn ed as s e ss in g o ffi c e r d id n ot sig n the c on s en t l e t t e r. Th e r ef o r e , the e xp la n at i on t h at t h e a s s es s e e h a s sh o wn r e as on ab l e cau s e d e fi e s lo g i c an d h en c e i t i s ap p a r en t t h at as s e s s e e h a s n ot sh o wn an y r e as on ab l e cau s e f o r c o m m i t t in g a d e fau lt b y n ot s u b m it t in g t h e c on s e n t fo r m .
2 1 . Th e n e xt ob j e ct ion r ais e d b y t h e l e arn e d au t h o ri s ed r e p r e s en t at iv e is t h at t h a t t h e a s s es s e e h a s n ot b ee n is s u ed sh o w c au se n o t i c e f o r t h e l ev y o f t h e p en alt y b u t t h e l ea rn e d as s e s sin g of fi c e r h a s i s su ed t h e sh ow cau s e n ot i c e f o r in it iat i on of t h e p en alt y p r o c e ed in g s. H e w as r ef e r rin g t o t h e n ot i c e d a t ed 2 6 / 9/ 2 0 1 3 . W e h a v e ca r e fu ll y g o n e t h r o u g h t h e n ot i c e an d in p a ra n u m b e r 5 o f t h e ab o v e n ot ic e it cl ea rl y sa ys t h at the as s e ss in g o ff ic e r h as is su e d sh ow c au s e n ot i c e t o th e a s s es s e e s t at in g t h at wh y p en alt y o f ₹ 1 0,0 0 0 sh ou ld n ot b e im p o s ed u p on t h e a ss e s s e e u n d e r s e ct i on 2 7 1 ( 1) ( b ) of t h e i n c o m e t a x a ct f o r fa ilu r e t o co m p l y wit h t h e t e rm s o f t h e n ot i c e u n d e r s ec t i on 1 4 2 ( 1) o f t h e in c om e t a x a ct , 1961. In vi e w of t h is , the a rg u m en t of the l ea rn ed au t h o ri s ed r ep r e s en t a t iv e t h at it is a sh ow cau s e n ot i c e fo r in it ia t i on of t h e p en alt y p r o c e ed in g s an d n ot f o r t h e l e vy of t h e p en alt y i s d ev oi d o f an y m e ri t a n d h en c e r ej e ct e d .
21 MA Nos. 31 to 37/Del/2019Jayanti Dalmia
22. On r ead in g of the sh o w cau s e n ot i c e , in p a ra no 5 c l ea r cu t sat is fa ct i on o f fai lu r e of a s s es s e e w as a l s o m en t i on ed .
2 3 . Th e n e xt ob j e ct ion r ais e d b y t h e l e arn e d au t h o ri s ed r e p r e s en t at iv e is t h at t h e as s e s s e e h as n ot b e en g i v en a c op y of t h e in f o rm at i on a vai lab l e wit h t h e a s s es sin g o ffi c e r o f va ri ou s b an k st at e m ent s / a c c ou n t s. We a r e n ot i m p r es s ed wit h t h is a rg u m en t f o r r e as on t h a t t h e as s e s s e e wa s sh own t h e in f o rm at i on a va ilab l e wit h t h e a s s e s sin g of fi c er d u rin g t h e c ou r s e of s ea r ch . F u rt h e r, as p e r l et t er d at ed 1 8/ 7/ 2 0 1 3, l e a rn ed a s s e ss in g of fi c e r in p a ra n u m b e r 3 h as g iv en t h e c om p l e t e d et ai ls t h at wh at in f o rm at i on is ava ilab l e w it h t h e a s se s sin g of fi c e r an d m ad e a r eq u est t o t h e a s s es s e e t o sig n t h e c on s en t let t e r i f Th e ab o v e in fo r m at i on is n ot ava ilab l e wit h h e r . Th e r e f o r e, w e d o n ot fin d an y m e rit in t h e ab ov e a r g u m en t of t h e as s e ss e e t h at a ss e s s e e w a s n ot h a vin g an y in f o rm at i on ab o u t t h e f o r eig n b an k a cc ou n t . F u rt h e rm o r e , in t h e ca s e o f t w o o f t h e r el at i ve s of t h e as s e ss e e on i d en t i c al f act s w e r e sh o w n in t h e p r oc ee d in g s an d va r i ou s p r o c e ed in g s w e r e g oin g on in t h os e ca s e s. Th e r e fo r e, t h e a b o v e a rg u m en t o f t h e a s s e ss e e d o e s n o t h ol d an y w at e r .
2 4 . T h e n e xt a rg u m en t of t h e l ea rn ed a u t h o ri s ed r ep r e s en t at iv e w as t h at t h e p en al t y l evi e d as p e r t h e co d i fi ed la w wh i ch i s i n c om e t a x a ct , wh er e a s t h e l e a rn e d c om m is si on e r of i n c om e t a x ap p eal h as t a lk ed ab ou t t h e m o ral it y . A c c o r d in g t o h im t h e p e n alt y c an n ot be l ev ied ev en if t h e as s e ss e e has not act e d a c c o rd in g to the m o r al s. We h av e c ar e fu l ly p e ru s ed t h e o rd e r o f t h e l ea rn ed as s e ss in g of fi c e r, h e h as n ot l e vi ed p en alt y o n t h at g r o u n d . Th e l ea rn ed c om m i ss i on e r app e al s h a s al s o n ot c on f ir m ed t h e p en a lt y on l y on t h is g r ou n d . Th e su b j e ct m at t e r o f t h e p en alt y i s a failu r e on p a rt of t h e a s s es s e e t o c omp l y wit h t h e n ot i c e is su ed b y t h e l ea r n ed a ss e s sin g of fi c e r u n d er s e ct ion 1 4 2 ( 1 ) of t h e in c om e t a x a ct . T h e r ef o r e , t h i s a rg u m en t of t h e a s ses s e e i s al s o n ot ac c ep t ab l e .
2 5 . Th e n ex t a rg u m en t o f t h e l e ar n e d au t h o ri s ed r ep r es en t at i v e is t h at t h at a s s e ss m en t o r d e r h a s b e en p a ss ed on 2 7/ 3/ 2 0 1 5 a n d t h e p en alt y in it iat i on as w e ll as the l ev y of the p en a lt y does n ot have an y c on n e ct iv it y wit h t h e a s s e ss m en t p r o c e ed i n g s . W e h a v e al r ea d y h el d t h at as s e ss m en t p ro c e ed in g s w e r e op en b e f o r e t h e l ea rn e d a s s es sin g o f fi c e r at 22 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia t h e t i m e wh en h e i s su ed n ot ic e u n d e r s e ct i on 1 4 2 ( 1) o f t h e in c om e t a x act . Th e r ef o r e the p e n alt y p r o c e ed in g s were in it iat e d d u rin g the as s e ss m en t p r o c e ed in g s an d t h e y al so cu lm in at e d d u rin g t h e as s e s sm en t p r o c e ed in g s , as a s s e ss e e f ail ed t o c o o p e r at e wit h th e in c om e t a x o ff ic e r b y si g n in g in su b m it t in g t h e c on s en t l et t e r .
2 6 . Th e n ex t a rg u m en t o f t h e l e ar n e d au t h o ri s ed r ep r es en t at i v e is t h at t h e l e a rn ed A O h i m s el f wa s n ot su r e w h et h e r t h e ad dit i on is r eq u i r ed t o b e m ad e in t h e h an d s o f t h e a s s es s e e o r n ot . H e wa s r e f er rin g t o t h e fa ct t h at the a d d it i on h as b e en made in the h an d s of the a ss e s s e e on p r ot e ct i v e b a si s . On ca r e fu l c on si d e rat i on of t h i s a rg u m en t we h av e c om e t o t h e c on clu si on t h at p en alt y i s n ot l e vi ed f o r t h e in c om e r eq u i r ed t o b e as s e ss e d in t h e h a n d s o f t h e a s s es s e e b u t it i s l ev i ed f o r st all in g t h e en q u ir y t o b e m a d e b y t h e as s e s sin g o ffi c e r f o r d et e rm in i n g t h e c o r r ec t in c om e of t h e a ss e s s e e. Had a s s es s e e sig n ed t h e c on s en t f or m t h e t ru t h wo u ld h a v e c o m e ou t an d if t h e a s s es s e e d o e s n ot h av e an y b an k a cc ou n t t h e r e w ou ld n ot h a v e b e en a n y i s su e wit h r e sp e ct t o t h e ad d it i on in t h e h an d s of t h e as s e s s e e e v en on p r ot ec t i v e b asi s . Th er ef o r e , w e r ej e ct t h is arg u m en t of t h e au t h o ri s ed r ep r es e n t at i v e.
2 7 . Th e n ex t a rg u m en t o f t h e l e ar n e d au t h o ri s ed r ep r es en t at i v e is t h at t h e 3 p e r s on s of t h e fa m il y a r e in v ol v ed in t h i s ca s e, a lon g wit h t h e as s e ss e e , n on e of them has b e en in q u i r ed d u rin g the a s s e ss m en t p r o c e ed in g s . T h is d o e s n ot h a v e an y b e ar in g a c c or d in g t o u s o n t h e p en alt y p r o c e ed i n g s . Th e p en al t y p r o ce ed i n g s h a s b een in i t iat ed f o r t h e r ea s on t h at a s s e ss e e d id n ot c o m p l y wit h t h e n o t ic e u n d e r s e ct i on 1 4 2 ( 1) of t h e in c o m e t ax a ct , t h e r e f o re , c allin g t h e ot h er p e r s on s w ou ld n o t h av e s e rv ed an y p u rp o s e. F u rt h e r a s p e r in f o rm a t i on wi t h t h e a s s e ss in g o ffi c e r , n am e s of all the p e r s on s ar e m en t i on ed in the re s p e ct iv e in f o rm at i on an d s ep ar at e p r o c e ed in g s a r e p en d in g a gain st ea ch o f t h e m . As per the in f o r m at i on su b m it t ed by the a s s e ss e e a ss e s sm en t p r o c e ed in g s w e r e c on t in u in g a s it i s ap p a r en t as p er t h e in f or m at i on su b m it t ed at s r n o 3 2 an d 3 3 o f p a p e r b o ok o f t h e a ss e s s e e wh e r e t h e ap p ell at e o rd e r s wit h r e sp e ct t o t h e ot h e r 2 p e r s on s a r e m e n t ion e d . Ev en ot h e r wi s e w e d o n ot fin d an y r e a so n t h at w h y A O sh ou ld ex am in e in p en alt y p r o c e ed in g s u / s 2 7 1 ( 1 ) ( b ) o f t h e a ct .
23 MA Nos. 31 to 37/Del/2019Jayanti Dalmia 2 8 . On t h e i ssu e r eg ar d in g a p p li c ab ili t y of t h e d e ci si on o f t h e an ot h e r p e r s on , M r S an j ay D alm i a a s w ell a s Mr . Man i sh P e ri wa l , w e f in d t h a t c o or d in a t e b en ch o r d e r s in ca s e of M r S an j a y D alm ia a r e als o b a s ed on t h e sa m e d o cu m en t s on wh i ch t h e p en alt y p r o c e ed in g s a r e in c a s e o f t h e as s e ss e e . Th e r e i s als o n o vi ol at i on o f t h e p rin cipl e o f n a t u r al j u st i c e in t h e ca s e of t h e a ss e ss e e , a s a s s e ss e e wa s aw a r e ab ou t t h e in f o rm a t i on d u ri n g t h e c ou r s e o f s ea r ch a s w ell as as p er n ot i ce i s su ed u n d er s e ct io n 1 4 2 ( 1 ) o f t h e in c om e t ax ac t . Th e i s su e wa s t h at th e as s e ss e e wa s r eq u e st ed f o r m e r el y sig n in g c on s en t f o rm . It i s h eld in t h e c as e of M r S an j a y D alm ia , t h e r e w ou ld n ot h a v e b e en an y p r ej u di c e cau s ed t o t h e as s e ss e e , i f sh e d o e s n ot h a v e an y b a n k ac c ou n t with t h e HS BC b an k . In ca s e o f M r Man ish P e riw al t h e p en al t y w as al s o l e vi ed f or t h e sim p l e r ea s on of n o t s ig n i n g t h e c on s en t l et t e r . Th e i s su e w a s n ot wh et h e r t h e as s e ss e e has c on f e ss e d d u rin g the c ou rs e of s ea r c h or r et ra ct ed t h e r ea ft e r . H en c e , b ot h t h e s e c as e s r eli ed b y ld D R a r e on sim ila r f ac t s .
2 9 . Th e le a rn ed au t h o ri s ed r ep r es e n t at i v e al so r e f er r e d t o t h e d e ci si on o f c o or d in a t e b en ch in cas e o f M rs . S u m a n Lat a B an sal ( I TA n u m b e r 5 2 5 - 5 3 0/ MU M/ 2 0 0 8) . W e h a v e c a r efu lly c o n sid e r ed t h e fa ct s o f t h at ca s e an d t h e i s su e b e f o r e t h e c o o rd in at e b en ch . In t h at d e ci si on , t h e r e wa s n o is su e o f p en a lt y u n d e r s e ct i on 2 7 1 ( 1) ( b ) o f t h e in c o m e t a x ac t . Th e on ly is su e wa s w it h r e s p e ct t o wh et h er t h e n on is su e o f t h e n ot i c e u n d e r s ec t i on 1 4 3 ( 2) will r en d e r t h e a s s es s m en t p r oc e e d in g s u n d e r s e ct i on 1 5 3 A of t h e in c om e t a x act a s n u ll an d v oi d . Th e co o r din at e b en ch h a s h el d t h at a s se s sm en t p r o c e ed in g s u n d e r s e ct i on 1 5 3A , c ann ot b e h el d as n u ll an d v oid f o r n on - is su an c e of n ot i c e u n d e r s ec t i on 14 3 ( 2) o f t h e a ct . Th e r ef o r e , t h e ab o v e d e ci si on d o e s n ot h av e an y b ea rin g on t h e p r e s en t ap p eal .
30. Th e le a rn ed au t h o ris e d r ep r e s e n t at i v e fu rt h e r rel ied u p on the d e ci si on of t h e c o o r d in at e b en ch in ca s e o f A k h il B h a rt i ya S h ish ak S an g h Bh av an T ru st v s A D IT 1 1 5 T TJ 4 1 9 . I t is t h e c on t en ti on of t h e l ea rn ed au t h o ris e d r ep r es e n t at i ve t h at t h e l ea rn ed A O h a s pa s s e d o rd e r u n d e r s ec t i on 1 4 3 ( 3) an d n ot u n d er s e ct i on 1 4 4 of t h e a ct . Th e r e f or e , it m ean s t h at the su b s eq u e n t co m p l ian c e in the a s s es s m en t p ro c e ed in g s wa s c on s id e r ed as g o od c om p lia n c e an d t h e d e f au lt c om m it t e d ea rli e r w e r e 24 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia ig n o r ed b y t h e l ea r n ed A O. H en c e p e n alt y u n d e r s ec ti on 2 7 1 ( 1) ( b ) of t h e in c om e t ax a ct is n ot l ev iab l e . T h e co o rd in at e b en ch i n p ar a n u m b e r 2 .5 has h eld that the su b s e q u en t c om p lian c e in the as s e s sm en t p r o c e ed in g s w as c o n sid e r ed a g o od c o m p lia n c e an d t h e d e fau lt c om m it t ed ea rl i e r w e r e ig n o r e d b y t h e A O . H o w e v er , in t h e p r es en t ca s e , t h e fa ct s ar e q u i t e st ar k wh i ch sh o w s t h at ev e n in t h e a ss e s sm e n t p r o c e ed in g s as s e ss e e h a s n ot s u b m it t e d t h e c on s e n t l et t e r t o t h e a s s e ss in g o ff ic e r . Th e r ef o r e , e v en in the a s se s sm en t p r oc e e d in g s to t he r e w as no c om p lian c e b y t h e as s e ss e e of t h e in f o rm at i on a sk ed f o r b y t h e le a rn ed as s e ss in g o f fi c er . T h e r e fo r e , ev en in t h is c a s e, t h e r e i s n o co m p li an c e at all, l eav e a sid e t h e su b s eq u en t c om p li an c e . In vi ew o f t h i s, t h e fa ct s o f t h e p re s en t c a se a r e q u it e d i f f er en t f r om t h e f a ct s st at ed b ef o r e t h e c o or d in a t e b en ch in t h e c a s e cit e d b ef o r e u s . H en c e t h e r eli an c e p la c ed b y t h e l ea rn ed au t h o ri s ed r ep r es en t at i v e on t h is ca s e i s r ej e ct ed .
3 1 . A s s e ss e e h a s al s o s t at ed t h at a sk in g as s e ss e e t o sig n a c on s en t fo r m is vi ol at i v e o f a rt ic l e 2 0 ( 3) o f t h e c o n st it u t i on o f In d i a. W e a r e n o t in ag r e e m en t wit h t h e as s e ss e e on t h is p oin t . F i r st l y t h e as s e ss e e is n ot at all an ac cu s ed . F u r t h e r m er e ly m ak i n g a st at em en t th at i t vi ola t es t h e art ic l e 2 0 ( 3) w it h ou t su b st an t i at in g t h e r e as on f or t h e sa m e , p l e a of as s e ss e e c an n ot b e ac c ep t e d . Ev en ot h e rw is e w e fa il t o u n d e r st an d t h at wh y as s e s s e e t h in k s t h a t it i s a e vid en c e ag ain st h e r wh e n sh e d o e s n ot h av e an y b a n k ac c o u n t . In fa ct , t h e ev i d en c e s ar e n ot ag ai n st h e r b u t in h e r f av ou r . F u rt h e r t h e ca s e o f t h e a ss e ss e e d o e s n ot h old an y c r ed en c e in vi e w o f t h e d ec is ion o f t h e h on . S C i n ca s e o f Rit e sh S i n h a V S t at e o f U t t a r P r ad e sh A IR 2 0 1 3 S C 1 1 3 2 2 S C C 3 5 7 wh e r e t h e h on ou ra b l e S C h a s h el d t h at i f an a c cu s ed p e r s on is d i r ec t ed t o g i v e vi c e sa m p le s d u ri n g t h e c ou rs e of in v e st ig a t ion of an of f en c e, t h e r e is n o vi ol at i on o f a rt i cl e 2 0 ( 3) o f t h e C on st it u t i on .
3 2 . A s s e s s e e h a s fu rt h e r c on t en d e d t h a t p ro vi si on of s e ct i o n 1 4 2 ( 1) d o es n ot a sk a s s es s e e t o g iv e ev id en c e ag ain s t h e r . W e ha v e alr ea d y d ea lt wit h t h is is su e st at i n g t h at i t i s n ot an e vid en c e ag ain st t h e a s s e ss e e an d t h e r e f o r e, t h i s a rg u m en t i s r ej e ct ed .
25 MA Nos. 31 to 37/Del/2019Jayanti Dalmia 3 3 . T h e l as t g r ou n d r ai s ed b y t h e l ea r n ed au t h o r is ed r ep r e s en t a t iv e w as t h at t h e p en alt y or d e r i s a t im e b a r r e d . W e a r e ca re fu ll y c on s id e r ed t h e p r o vi si on s o f s ect i o n 2 7 5 ( 1) s e e wh ic h p r o vid e s t hat i n an y ot h e r ca s e t h e p en alt y or d e r is sh al l b e p a s s ed a ft e r t h e e xp i ry o f t h e fin an ci al y e a r in wh i ch t h e p r o c e e d in g s , in t h e c ou r s e of wh i ch a ct i on f o r im p os it i on o f p en alt y h a s b e en in i t iat ed , o r c om p l et ed , o r 6 m on th s f r om t h e e n d o f t h e m on t h in wh ich ac t ion f o r im p o sit i on o f p en al t y i s in i t iat ed , wh ich e v e r . E xp i r e s l et t e r. In t h e p r e s en t c a s e t h e p en alt y h a s b e en l e vi ed wid e or d e r d at ed 1 2 / 1/ 2 0 1 5 . T h e a s s es s m e n t o rd e r in c as e o f t he a s s e ss e e h as b e en p as s ed on 2 7 / 3/ 2 0 1 5 . W e h av e al r ea d y h el d t h a t t h e p e n alt y p r o c e ed in g s h av e b e en in i t iat e d d u ri n g t h e a ss e s sm en t p r o c e ed in g s a ft e r t h e i ss u e o f s ev e r al n o t i c es t o t h e a s s es s e e . Th e r e f o r e, t h e ou t e r li m it fo r p a s sin g o f t h e p en alt y o rd e r w as 3 0/ 9/ 2 0 1 5 wh e r ea s t h e o rd e r h as b e en p as s ed on 1 2/ 1/ 2 0 1 5 . In vi e w o f t h is , t h e p en a lt y o rd e r sa m e b e en p as s ed b y t h e le ar n ed a s s es si n g o ffi c e r as p ro vi d e d u n d e r s e ct i on 2 7 5 ( 1 ) ( c) o f t h e ac t h en c e , t h e y a r e n ot b ar r ed b y li m it a t i o n of t im e . 34 . L ast l y, t h e r ev en u e h as r el i ed u p on t h e d e ci si on o f M r . S an j a y D a lm i a I TA N o. 3 7 9 5 t o 3 8 0 1/ D el/ 2 0 1 4 ( A ss e ss m en t Y ea r: 2 0 0 6 - 0 7 t o 2 0 1 2 - 1 3 S an j ay D al am i a wh er e in in t h e c ou r s e o f sam e s e a rch , sa m e a ll eg ed b an k ac c ou n t s t h e p en alt y u n d e r s e ct i on 2 7 1 ( 1) ( b ) of t h e a ct wa s l evi ed f o r t h e sam e o ff en c e of n ot su b m it t i n g the c on s e n t let t e r was c on f ir m ed by the c o or d in a t e b e n ch a s u n d e r: -
"R ea s on s an d d e ci si on s 1 2 . W e h a v e ca r e fu lly c on si d e r ed t h e r ival c on t en t i on s an d als o p e ru s ed t h e r el ev an t p ap e r b o ok fu rn ish e d b y t h e a ss e s s e e. W e h a v e a ls o p e ru s ed t h e re l ev an t d eci si on s cit ed b e f o r e u s . I n t h e p r esen t c as e t h e si m p l e is su e i s t h at Ld . a s s es si n g o ff ic e r h a s r e c eiv e d c ert ai n in f o rm at i on wit h r e sp e ct t o c e rt ain b an k a c c ou n t s wi t h HS BC ac c ou n t s, G e n e va wh e r e t h e n am e of the a s s e s se e is m en t i on ed . S u b s eq u e n t ly , s ear ch was al s o c on d u ct ed u n d e r s e ct i on 1 3 2 o f t h e in c om e t ax ac t . Wit h r e sp e ct t o t h e b an k a c co u n t wit h HS BC , G en ev a t h e a s se s s e e w as i s su ed a n ot i c e u n d e r s ec t i on 1 4 2 ( 1 ) o n 1 8/ 0 7/ 2 0 1 3 wh e r e t h e as s e s se e w as r eq u i r ed t o fu rn i sh c er t ain in f o r m at i on wit h r e sp e ct t o t h at b an k ac c ou n t an d in c as e t h e as s e s s e e d o e s n ot h av e t h e b an k a c c ou n t st a t em en t t h e n a p a rt icu la r 26 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia c on s e n t l et t e r wa s r eq u ir e d t o b e si g n e d , s o t h at th e o ff ic e o f t h e i n c o m e t ax o f fi c e r can h el p t h e as s e s s e e in ob t ain in g b an k a c c ou n t f r om t h a t p a rt i cu la r b an k . In r e sp on s e t o t h at n o t ic e t h e as se s s e e d id n o t fu rn i sh eit h e r t h e b a n k a c c ou n t o r fu rn i sh ed t h e c on s en t l et t er b u t p l ead e d t h a t the a s s es s e e d o es not h av e an y su ch b an k a c c ou n t . Th e r ef o r e , the p en alt y u n d e r s e ct i on 2 7 1 ( 1) ( b ) of t h e in c o m e t ax a ct wa s in it ia t ed an d sh ow cau s e n ot ic e d at e d 2 6/ 0 9 / 2 0 1 3 wa s i ssu e d t o t h e a ss e s s e e in r e sp on s e t o wh ich ass e s s e e su b m it t e d t h at h e h a s al r e ad y su b m i t t ed r ep l y t o t h e n ot ic e d at ed 1 8/ 0 7/ 2 0 1 3 s u b m it t in g t h e r e p ly on 2 3/ 0 7/ 2 0 1 3 an d c op y o f wh i ch w as al s o su b m i t t ed o n 2 3/ 0 9/ 2 0 1 3 . Th e r e f or e t h e clai m o f t h e a s s es s e e i s t h at t h e r e i s a c om p let e c om p lia n c e o f t h e sai d n ot i c e an d t h e r e f or e p en al t y can n ot b e l ev i ed . Th e Ld . a s ses sin g o ffi c e r r ej e ct ed t h e c on t en t ion o f t h e a s s e ss e e an d h eld t h at as n o c on s en t l et t e r wa s su b m it t ed b y t h e a s se s s e e an d m e r el y st at in g t h at a ss e s se e d o e s n ot h av e b an k ac c ou n t t h e r e i s n o c om p lian c e b y t h e as se s s ee , t h e r e f o r e, t h e p en alt y u n d e r s e ct i on 2 7 1 ( 1) ( b ) of t h e ac t of R s . 1 0, 0 0 0 wa s l e vi ed f o r all t h e s e y e a rs . CI T ap p eal c on fi rm e d t h e a b ov e p en alt y f o r al l t h e y e a rs . W e fu ll y ag r e e wit h t h e fi n d in g g i ve n b y t h e Ld . CI T ( A ) in c on f ir m in g t h e ab ov e p en a lt y an d o u r re a s on s a r e a s u n d e r: -
a. Th e n a m e o f t h e a s s e ss e e ap p e a r ed in a p a rt icu la r b an k a c c ou n t m ain t ain ed wit h t h e HS BC a c c ou n t an d t h e r e f o r e t h e Ld . a s s es si n g o f fi c er h as r eq u e st ed t h e as s e ss e e t o fu r n i sh eit h e r t h e b an k a c cou n t o f t h a t p a rt i cu la r b an k o r t o g i v e c on s en t l et t e r in a p a rti cu l a r f o r m s o t h at t h e as s e ss e e c an b e h e lp e d b y t h e r ev en u e f o r ob t ain in g t h e c op i e s o f t h e ab ov e b an k a c c ou n t . In ca s e i f t h e co n t en t i on of t h e a ss e s s e e i s c o r r e ct , t h en n at u ra lly t h e b an k a c c ou n t w ou ld n ot b y t h e H SB C b a n k st at in g t h at su ch ac c ou n t s a r e n ot h eld b y t h e a s s es s e e . If t h e a s s e s se e h a s su ch ac c ou n t , in t h e s t at u s of t h e a c c ou n t h old e r o r a ca s e o f b en e fi cia ri e s o r s et t l e r s , t h en n at u ral ly t h e HS BC b an k t o t h e r e v enu e will su p p ly t h e b an k a c cou n t . I f t h e as s es s e e s ig n s t h e c on s e n t l ett e r t h en t h e v e r si on of t h e a s s es s e e i s p r ov e d if n o su ch b a n k ac c ou n t i s re c ei v ed f r om t h at p a rt i cu la r b an k o r s u ch b an k r e fu s e s st at in g t h a t th e a ss e s se e d o e s n ot ow n t h a t b an k ac c o u n t . Th e r e fo r e t h e r e i s n o r ea s on f o r t h e as s e s s e e t o n ot t o s ig n t h e c o n s en t f o rm . I n v i e w of t h e a b ov e fa ct s, t h e on l y in f e r en c e t h at can b e d ra wn i s t h at , t h a t as s e ss e e d o e s n ot wan t r e v en u e 27 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia t o r ea ch a t t h e c o n clu si on wh et h e r t h e a s s e ss e e i s h a vin g t h e b an k ac c ou n t o r n ot . A c c o rd in g t o u s t h e as s e ss e e is m a kin g an at t e m p t t o f or e st all t h e en q u i r y of t h e r ev en u e .
b . Th e r e ve n u e i s n ot m a k in g an y f ish in g or ro win g I n q u i ry . I t h a s r e c eiv e d t h e in f o r m at i on in t h e f o rm o f d o cu m en t t h at h as b ee n c oll e ct ed b y t h e g o v e rn m en t o f I n d ia a s p a rt of t ax in f or m at i on e xc h an g e t r e at y . Th e n am e o f t h e as s e ss e e i s a p p ea r in g in t h at p ar t i cu lar d o cu m en t . Th e r ef o r e , t h e r e v en u e i s as k in g as s e ss e e t o h elp in a s ce r t ain in g t h e c o rr e ct fa ct s. Th e r ev e n u e h a s fu rt h e r es t ab l ish e d t h at t h e p a rt i cu la r b an k ac c ou n t h a s s om e c on n e ct i on wi t h t h e a s s es s e e b ec au s e n am e o f t h e a s s e ss e e i s m en t ion e d an d f u r t h e r t h e n a m e o f th e f am i ly m em b e rs o f t h e a ss e s s e e a r e al s o a p p ea rin g a s at t o rn e y an d a c cou n t h ol d e r 1 an d ac c ou n t h old e r 2 . T h is fa ct g i v es c r ed e n c e t o t h e en q u i r y o f t h e r e v en u e an d t h e d o cu m en t r e c eiv e d in in f o rm a t i on e x ch an g e fr o m f o r eig n c ou n t r y . Th e r ef o r e , t h e r ev e n u e h as g ot t h e s p e ci fi c in f o r m at i on , b u t t o a sc e rt ain t h e c o rr e ct fa ct s b e cau s e of t h e c on fi d en t iali t y ag r e e m en t b et w e en t h e b an k an d t h e a ss e s s e e, t h e c on s en t l et t e r is r eq u i re d t o b e si g n ed b y t h e as s e ss e e . Th i s i s n o t d on e b y t h e a ss e s s e e d e sp i t e sp e cif ic n ot ic e i ssu e d b y t h e as s e s sin g of f ic e r.
c. M e r el y sig n i n g the c on s en t l et t e r w ou ld not have p r ej u d ic e d the in t e r e st o f t h e a s s e ss e e b ec au s e if t h e a c c ou n t w ou ld n ot h av e b e en h avin g an y c on n e ct i on w it h t h e as s e ss e e . Th e f o r eign b an k wo u ld n ot g i v e t h e d et ai ls o f su ch ac c ou n t . Th e r ef o r e , t h e in t en t i on s o f t h e as s e s s e e in n ot sig n in g t h e c o n s en t l et t e r p r o v e wh at a s s e ss e e wan t s t o h id e t h e in f o rm at i on .
d . N ot i c e i ssu e d b y t h e Ld . a s s e ssi n g of fi c er u n d e r s ect i on 1 4 2 ( 1 ) of t h e act w a s v e ry s p ec i fi c an d p r eci s el y o n t h e p oin t g iv in g t h e cl e a r cu t r eq u i r e m en t o f t h e law , a n d in ab s en c e o f c om p lian ce o f s u ch n ot ic e , t h e p en alt y u n d er s ec t i on 2 7 1 ( 1 ) ( b ) is c o r r ec t ly l e vi ed , e . Th e d e l et i on o f t h e a d d it io n in t h e h an d s o f t h e a s s es s e e d o e s n o t h elp t h e a rg u m en t of t h e a s s es s e e b e cau s e t h e ad d i t i on wa s m ad e in t h e han d s o f t h e a s s es s e e on p r o t e ct iv e b a si s an d on su b s t an t i v e b a si s in t h e h an d s o f t h e ot h e r fam ily m e m b e r s o f t h e a s s es s e e . Th e ad d it i on in t h e h an d s o f t h e ot h e r fam ily m em b e r s on su b st an t iv e b a si s h av e b e en u p h el d b y t h e ap p ella t e 28 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia au t h o rit i e s an d t h e r e fo r e t h e ad d it i on in t h e h an d s o f t h e a ss e s s e e h as b e en d el et ed , w h ic h wa s m ad e on t h e p r ot e ct i v e b as is . Th e r ef o r e , t h e r e su lt of ap p eal of t h e a s s es s e e b e f or e t h e ap p el lat e au t h o rit y d o es n ot h el p t h e ca s e of t h e a s s es s e e so fa r a s t h es e p en alt i e s a r e c on c e rn ed . f . Th e a rg u m en t o f t h e as s e s s e e i s t h a t t h e r e i s n o p rovi si on o f i s su e of n ot i c e under s e ct i on 142 ( 1) of the ac t f or a s s es si n g the in c om e u n e ar t h ed d u rin g the c ou rs e of s e ar ch an d therefore the p en al t y o rig in at in g f r om n o n - c om p lian c e o f t h a t n ot i c e d o e s n ot s u r viv e b e c au s e o f t h e r ea s on t h at as s e ss m en t h a s b e e n m ad e u n d e r se ct i on 1 5 3A o f t h e in c om e t a x a ct . Th e a b ov e a rg u m en t o f t h e a s s e ss e e is r eq u i r e d t o b e r ej e ct ed at t h e t h r e sh old it s elf b e cau s e o f t h e r ea s on t h at t h e p r ovi si on s o f s e ct io n 1 5 3A p r ov id e s t h a t t h e r et u rn fu rn i sh ed b y t h e as s e s s e e in r e sp on s e t o t h e n o t ic e u n d e r s e ct i on 1 5 3A a r e t o b e t r eat ed a s if t h ei r r et u rn s fu rn i sh ed u n d e r s e ct i on 1 3 9 o f t h e in c o m e ta x act . Th e p r o vis i on s o f s e ct i on 1 4 2 ( 1) als o p r o vid e s t h a t f or t h e p u r p os e o f m ak in g an as s e ss m en t u n d e r t h e A ct , t h e a s s e s sin g of fi c e r m a y s e rv e a n ot i c e r eq u i r in g a s s e ss e e on t h e d at e sp e ci fi e d t h e r ein t o fu rn ish c e rt ain d et ail s. Th e r ef o r e , we are of the o p in i on t h at the Ld . as s e ssin g o f fi c er is em p ow e r ed u n d er t h e p r o vi si on s o f t h i s a ct , ev en in c as e o f a ss e s sm en t u n d e r s e ct i on 1 5 3A t o i s su e n o t i c e u n d e r s e ct i on 1 4 2 ( 1) o f t h e in co m e t ax a ct . H en c e t h e a b o v e p l ea of t h e a s s e ss e e i s r ej ect e d .
1 3 . No w w e c o m e t o t h e va ri ou s d e ci si o n s ci t ed b y th e a ss e s se e b e f o r e u s p le ad in g t h at p en al t y le vi ed u n d e r s ect i on 2 7 1 ( 1) ( b ) is n ot su st ain a b l e . a. F i rst d e ci si on cit ed b ef o r e us is in c as e of IT A N o. 4429 to
4 4 3 4/ d el/ 2 0 1 5 f o r a s se s sm en t y ea r 2 0 0 3 - 0 4 t o 2 0 0 8 - 0 9 in ca s e o f LK G b u ild e r s p ri vat e l im it ed v e r su s D C IT wh er e in t h e p en alt y w as d el et ed f or n on - c o m p li an c e o f st at u t o r y n o t i c es wh e r e t h e as s e s s e e h a s sh own a r ea s on a b l e c au s e . T h e f ac t s of t h e ca s e sh o w s t h at a ss e s s e e is en g a g ed in r eal e st at e an d len d in g t r ad in g et c an d s ea r ch an d s eiz u r e a ct i on wa s c on d u ct ed at the p r e m i s es of the a s se s s e e on 3 1/ 0 1/ 2 0 0 8 . A ll the as s e ss m en t s co m p l e t ed u n d e r s e ct i on 1 4 4 r ead wit h S e ct i o n 1 5 3A o f t h e in c om e t a x a ct an d d u rin g t h e c ou r s e o f a ss e s sm en t p r o c e ed in g s , t h e as s e ss in g of fi c e r in i t iat ed p en alt y p ro c e ed in g s u n d er s e ct i on 2 7 1 ( 1) ( b ) f or n on - c om p l ian c e o f c er t ain st at u t o r y n ot ic e s . Th e r ea s o n sh o wn b y t h e as s e ss e e f o r su ch n on - c om p lian c e wa s t h at t h e r e w e re m o r e t h an 3 0 3 29 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia g r ou p as s e s sm en t s c on d u ct ed d u r in g s h o rt sp a n o f 5 m on t h s . H en c e , it wa s p r ac t i call y d i ffi cu lt t o c om p ly wit h all t h e n ot i c es in a ll t h e c a s es at t h e ap p oin t ed d at e an d t h e r e f o r e t h e r e wa s d el ay in c om p lian c e o f t h e n ot i c e s . F u rt h e rm o r e , it wa s a ls o st at ed t h at t h e con t r oll in g p e r s on o f t h e g r ou p wa s in j u d i cia l cu st od y f o r m or e t h an 2 y e a r s, wh o w as h el m of t h e af fai r s fo r t ak in g al l t h e d ec is i on s an d wa s a wa r e of t h e t a x m a t t e rs an d d o cu m en t s . Th e r ef o r e , t h e r e w a s d ela y in c oll e ct in g su c h in f or m at i on an d c on s e q u en t l y m ak in g ce r t ain co m p l ian c e s. In vi ew of t h is p a rt i cu la r f a ct s t h e p en a lt i e s w e r e d el e t ed . In t h e p r e s en t c as e , t h e fa ct s a r e v e ry cl ea r t h at the as s e s s e e was a sk e d to co m p ly wit h c e rt ain n ot i c es wh i ch as s e ss e e d e fian t ly d id n ot c om p ly b y fu rn i sh in g s u ch in f or m at i on o r if t h e as s e ss e e d o e s n ot h av e su ch in f o rm at i on b y n ot sig ni n g t h e c on s en t let t er . In vi e w o f t h is t h e r eli an ce p lac e d o n t h e ab ov e d ec isi on is in c o r r ec t .
b . T h e 2 n d d e ci si on r eli e d u p on b y t h e a s se s s e e i s wi t h r e sp e ct t o I TA No . 6 4 2 5 an d 6 4 2 6/ d el/ 2 0 1 5 f o r a s se s sm e n t y e a r 2 0 0 6 - 07 in c a s e o f S h . S h ya m su n d e r J in d a l . W e h a v e ca r e fu ll y p e ru s ed t h e fa ct s o f t h e a b ov e ca s e an d w e a r e of t h e c on sid e r ed o p in ion t h at in th at p a r t icu l a r ca s e, it wa s n o t c on sid e r ed b y t h e c o o rd i n at e b en ch t h at wh et h e r t h e n on - filin g o f t h e c on s en t le t t e r is a co m p l ian c e o r n o t . Th e b en ch al s o d i d n ot co n si d e r t h at the c on s en t l et t e r in the ab se n c e of the in f o rm at i on was not su b m it t ed , an d t h e r e f or e t h e r e w a s a n on - c om p lian c e of t h e n ot i c e u n d e r s ec t i on 1 4 2 ( 1) of t h e in c om e t ax a ct . F u rt h e r m o r e in p a ra No . 6 o f t h at p a rt i cu la r o rd e r it is s t at ed b y t h e c o o rd in at e b en ch t h at : -
― In ou r op in io n , wh en n ot h in g wa s b r ou g h t on r ec o rd t o s u b st an t iat e t h at t h e a ll eg ed b a n k an d a c c ou n t a ct u ally b el on g t o t h e as s e ss e e , t h e r e wa s n o p o ss ib il it y o f fu rn i sh in g t h e c on s en t f or m , p a rt ic u la rly wh en t h e as s e ss e e t i m e an d ag ain d en i ed t h at t h e all e g ed b ank a c c ou n t b el on g t o h im . ‖ [ u n d e rlin e su p p li ed b y u s] I n t h e p r e s en t ca s e t h er e is a sp e ci fi c n am e of t h e a s s e ss e e s h o win g t h at a s s es s e e h a s s om e r e lat i on sh ip wit h t h e p a r t i cu la r b an k ac cou n t h e ld wit h t h e HS BC a c c ou n t . In t h e p r e s en t ca s e t h e fa m il y m e m b e rs o f t h e a s s es s e e a r e f ou n d t o h a vin g su ch b an k ac c ou n t s an d the ap p el lat e au t h o rit y in t h ei r h an d s h as c on fi rm e d ad d it i on s . Th e r e f or e t h e d e ci si on cit ed b e f o r e u s hav e d i st i n ct fa ct s wh i ch 30 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia ar e n ot c om p a ra b l e wit h t h e fa ct s b e f or e u s. It i s fu r t h er t o b e n ot e d t h at wh en t h e r el at i v es o f t h e a s s e ss e e a r e h a vin g t h e b an k ac c ou n t s a n d ad d it i on a r e c on fi r m e d in t h ei r h an d s b y t h e 1 st app el lat e au t h o rit y a n d wh er e t h e n am e of t h e a s s e ss e e ap p ea r s in t h e in f o rm at i on r e c ei v ed u n d e r t h e i n f o rm at i on e xch an g e ag r e e m en t b et w e e n t h e t w o c ou n t r i es , W e d o n ot ag r e e t h at t h e r e is n o m at er ial b r ou g h t on r e c or d b y t h e r ev e n u e fo r in it iat i n g an en q u i ry . Th e r e fo r e , t h e reli an c e p la c ed b y t h e as s e ss e e on t h e d e ci si on o f t h e c o o rd i n at e b en ch d oes n o t ap p ly t o t h e p e cu li a r fa ct s of t h e c a s e.
c. Th e 3 rd d ec is i on r el i ed u p on b y t h e as s e s s e e i s wit h r e sp e ct t o t h e d e ci si on of c o o rd in at e b e n ch in ca s e o f Pia g am I m p ex p ri vat e li m it ed v er su s A CI T in I T A N o. 4 7 8 7/ d el/ 2 0 1 3 d at e d 0 6/ 0 2/ 2 0 1 4 . Th e a b o v e d e ci si on d o e s n ot a p p ly t o t h e f a ct s of t h e c as e as t h e r e wa s n o i s su e of in f o rm at i on r ec e iv e d b y t h e g o ve rn m e n t o f In d i a u n d e r t h e in f o rm a t i on e xch an g e . In vi e w of this the r eli an c e by the Ld. au t h o ri s ed r ep r e s en t a t iv e on t h is d e ci si on is in c o r r e ct .
d . Th e 4 t h d e ci si on r eli ed u p on b y t h e a s s es s e e i s wi t h r e sp e ct t o t h e d e ci si on of t h e c o or d in at e b en ch in c as e of P u sh p a Ga rg V s. A CI T in I TA N o. 4 8 5 2/ d el/ 2 0 1 3 d at ed 0 6/ 0 2 / 2 0 1 4 . Th e ab o v e d e ci si on d o e s n ot a p p l y t o t h e fa ct s o f t h e ca s e a s t h e r e w as n o i ss u e o f in f or m at i on r ec e iv ed b y t h e g ov e rn m e n t o f In d ia u n d e r t h e in fo rm at i on e x ch an g e . I n vi e w of t h i s t h e re lian c e b y t h e Ld . au t h o riz ed r ep r e s en t a t iv e on t h is d ec is io n i s in c o r r ec t .
e . In t h e en d t h e a s se s s e e h as p la c ed u p on t h e d e ci si on o f t h e H on 'b l e S u p r em e C ou rt in c as e o f M/ s Hin d u st a n st e el Lt d v er su s s t at e o f O ri ss a 8 3 IT R 2 6 ( S C ) . W e h av e ca r e fu ll y c on sid e r ed t h e riv al c o n t en t i on s wit h r e sp e ct t o t h e ap p li cab ilit y of t h is d e ci si on . Th e H on 'b l e S u p r e m e C ou rt h as h el d t h at an o rd e r- i m p o sin g p en alt y for fa ilu r e to ca r ry ou t a st at u t o ry ob lig at i on is t h e r esu lt o f a q u as ic ri m ina l p r o c e ed in g s an d p en alt y will n ot or d in a ril y b e im p o s e d u n le s s t h e p a rt y ob lig e d eit h e r act e d d e lib e rat e ly in d efi an c e of law or wa s g u ilt y of c on d u ct c on t u m a ci ou s or d ish on e st or a ct e d in c on sc io u s d i s r eg a rd of it s ob l ig at i on . In su ch ci r cu m st an c e s p en alt y sh ou ld n ot b e le vi ed . It i s fu rt h e r h el d t h at wh er e t h e r e i s a t e ch n i cal o r v enia l b r e ach of t h e 31 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia p r o vi si on s o f t h e a c t o r wh e r e t h e b r e a ch ) i s b on a fid e s t h at t h e v en d o r i s n ot lia b l e t o a ct in t h e m an n e r p r e s cr ib ed b y t h e st at u t e , t h e ad j u d i cat in g au t h o rit y will b e j u s t ifi ed in r e fu sin g t o im p o s e p en alt y . In t h at p a rt i cu l a r ca s e t h e i s su e wa s p e rt ain in g t o t h e sa le s t ax m at te r s wh e r e wh et h e r t h e am ou n t s ch a rg e d b y t h e c om p an y a s a fix e d p e r c en t a g e f o r st o rag e in su ran c e e t c it can b e said t o b e t h at as s e ss e e w as c a rr yi n g on b u sin e s s o f su p p l yin g m at e r ial an d it w ou ld n ot b e a d ea l er '. F u rt h e r , m e r el y r eg i st e rin g the a s s e ss e e is a d eal e r ' under the g enu i n e b eli e f t h at c om p an y wa s n ot a d ea l e r, n o p en alt y sh ou ld b e l e vi ed . In t h e p r es en t ca s e , t h e f ac t s a r e q u it e d i ff e r en t . In t h e p r e s en t ca s e t h e in f o r m at i on wa s r e c eiv e d b y t h e g o v e rn m en t of In d i a u n d e r t h e in f or m a t ion ex ch an g e ag r e e m en t wi t h ot h e r c ou n t r i es . I ssu e in vo lv ed i s no t o f re g i st e rin g o r m e r e t e ch n i c al o r v en i al c o m p li an c e d e fau lt b y t h e a s s e ss e e b u t i t is wit h r e sp e ct t o h ol d in g a f o re ig n b an k ac c ou n t w it h t h e b an k of t h e f o r ei g n c ou n t ry , wh i ch h as n ot b e en all eg ed ly d is cl o s ed b y t h e a s se s s e e t o t h e In d ian t ax au t h or it ie s . Th e r e fo r e it i s n e it h e r a t ec h n i cal n o r v en i al d e fau lt t o n ot t o si g n a c on s en t l et t e r t o a r ri v e a t t h e t r u e fa ct s of t h at p a rt i cu la r b an k a c c o u n t wh en t h e t w o o f t h e r elat iv e s of t h e as s es s e e a r e als o su b j ec t to si m ila r p r oc e e d in g s an d a d d it io n in t h ei r h an d s are c on f ir m ed by the 1 st ap p ella t e au t h o rit y. Th e r ef o r e the d ec is i on of H on 'b l e S u p r em e C ou rt a r e r en d e r ed o n d if f e r en t fa ct s an d d o n ot ap p l y in t h e p r e s en t c a se as t h e o f f en c e o f t h e a s s e ss e e fo r n on - c om p lian c e wit h t h e n ot i c e of t h e a ss e s sin g of fi c e r is n eit h e r t e ch n i ca l n o r v en ial in n at u r e.
1 4 . F u rt h e r on t h e i d en t ic al fa ct s an d ci r cu m st a n c es i n t h e ITA N o . 5 1 5 7 - 5 1 6 2/ D el/ 2 0 1 4 , t h e p e n alt i e s h av e b e en c on fi rm ed b y t h e c o o rd in at e b en ch co n si d e rin g t h e p e cu li ar fa ct s o f t h e ca s e a s u n d er : -
"1 1 . Th e L d . C IT ( A ) h as p r o p er ly t a k en n ot e o f all t h e s e r el e van t fa ct s, leg alit y o f n o t i ce s , n at u r e o f n on c o m p lian c e an d it s ad v e r s e i m p a ct on in v e st ig a t i on s r el at ed t o all eg e d u n d is c lo s ed HS B C b an k a c c ou n t . W e fin d n o in fi rm it y in t h e o rd e r o f L d . CI T( A ) c on fi rm in g t h e im p o sit i on o f p en alt y o f R s . 3 0 ,0 0 0/ - e a ch in a b o v e a ss e s sm en t y ea r s as d ef au lt s a r e m o r e t h an 3 t im e s . It h a s b e en rig h t l y h e ld t h at t h e r e i s n o la w t h at f o r ea ch d e fau l t s ep ar a t e n ot i c e u / s 2 7 ( 1 ) ( b ) sh ou ld b e i s su ed on d ef au lt in g 32 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia as s e ss e e . Th e o rd e r s o f ld . CI T( A ) b ein g j u st ifi e d on p r o p e r ap p r e ciat i on o f f ac t s an d law a n d b a s ed on r el e va n t S u p r em e C ou rt j u d g m en t s a r e u p h e ld . Th e ap p e al s of a s s es s e e a r e d i s m is s ed . "
1 5 . In vi e w o f a b ov e fa ct s w e d o n ot fi n d an y in fi rm it y in t h e o rd e r of t h e ld . A O in l e v yin g p e n alt y u / s 2 7 1 ( 1) ( b ) o f t h e a ct of R s 1 0,0 0 0/ - f o r all t h e s e s e v en y e ar s a n d Ld C IT ( A ) in c on fi rm in g t h e sa m e.
1 6 . In t h e r e su lt all t h e a p p eal fil ed b y t h e a s s ess e e a r e d i s m is s ed . "
35. A s s es s e e ag g ri e v ed wi t h the o rd e r of the c o o rd in at e b en ch , ch al l en g ed t h e o rd e r o f t h e c o o rd in at e b e n ch b ef o r e h o n ou ra b l e D elh i h ig h c ou rt . H on Hig h c ou rt v id e or d e r d at ed 2 1 / 3/ 2 01 8 h as d is m i ss e d t h e ap p eal o f t h e a s s es s e e h ol d in g a s u n d e r : - Pag e | 40 " T h e a ss e s s e e in t h e s e ap p e al s q u es t ion s t h e o r d er o f t h e IT A T w h ic h h ad u p h eld t h e c on c u r r en t f in d in g s wit h r e sp e ct t o n o n - c om p lian c e o f t h e n ot ic e u n d e r S e ct i on 1 4 2 ( 1) of t h e In c om e Ta x A c t , 1 9 6 1 ( h er e af t e r r ef e r r ed t o a s "t h e A ct ") b y t h e ap p el la n t / a ss e s s e e an d t h e c on s eq u en t i m p o sit ion of p en a lt y u n d e r S e ct i on 2 7 1 ( 1) ( b ) of t h e A ct . I t is u rg ed t h at t h e fin d in g s of t h e lo w e r au t h o rit i e s a r e c on t r a ry t o la w.
Th e a s s e ss e e w as s e rv ed w it h a n ot i c e ca llin g u p on h im t o co - op e rat e an d , in t e r al ia , f ill a c on s en t cu m - w aiv e r f or m . Th e f o rm is s et ou t in t h e d o cu m en t s an n e x ed t o t h i s p et it i on an d r eq u i r e s t h e a s s e s se e ‟ s c on s en t t o en a b l e t h e t a x a u t h o ri t i es t o o b t ain in f o rm a t i on f r o m S wi s s Ban k s i n r e sp e ct of bank a c cou n t s h eld there. Th e R e v en u e had r e li ed upon d o cu m en t s wh i ch i t cl aim s w er e r e c e iv ed f r om F r en ch o ffi ci al s ou rc e in d ic at i v e o f t h e f a c t t h at t h e a ss e s s e e wa s an at t o rn e y h ol d e r of a S wi s s Ban k a c c ou n t h old e r in HS B C Ban k . Th e as s e ss e e , of c ou rs e , d isp u t e s t h a t h e w as e v e r an at t o rn e y an d b y t w o l et t e r s st at ed th a t h e w as n ot ob lig e d to fi ll su ch c on s e n t fo r m as he wa s in no wa y in v o l v ed in those t ra n s ac t i on s o r t h at h e h ad n o c on n e ct i on wi t h t h e Ban k a c c ou n t s.
Th e A O - a s w ell a s t h e ap p e llat e au t h o rit i e s in clu d in g t h e I TA T w e r e of t h e o p in i on t h at h a vin g r eg ar d t o t h e n at u r e an d c on t e n t s of t h e fo r m , t h e a s s e ss e e c ou ld n ot h a v e r efu s ed t o an s w er t h e n ot ic e u n d e r S e ct i on 33 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia 1 4 2 ( 1 ) o f t h e A ct a n d t h e r e f o r e in vo k e d t h e p en al clau s e u n d e r S e ct i on 2 7 1 ( 1 ) ( b ) of t h e A ct .
L ea rn ed c ou n s el s u b m it s t h at t h e a ct i on o f t h e R e v en u e au t h o rit i e s is u t t e r ly u n w a r ran t e d . It i s su b m it t e d t h at u n l es s t h e r e i s so m e c r ed ib l e m at e ria l o r in f o rm at i on r e q u i rin g t h e R e ve n u e' s fu rt h e r in v est ig at io n s wit h r e sp e ct t o t h e a s s e ss e e ' s c om p l icit y , t h e r e w a s n o q u e st i on of c om p e llin g h i m t o a n sw e r t o t h e l et t e rs an d al s o sub m i t t h e c on s en t f o rm u n d e r S ec t i on 1 4 2 ( 1) o f t h e A c t . It i s su b m it t ed t hat in t h e c ou rs e o f t h e s ea r ch , n o in c rim i n at in g m a t er ial w a s, in fact , s e iz ed f r o m t h e a s s es s e e an d t h e r e f or e the p en al c on s eq u en c e h e ap ed u p on h i m, is wit h ou t au t h o rit y o f l aw .
Th i s C ou rt h a s co n s i d e r ed t h e su b m i ss io n s of t h e p ar t i e s. T h e m at e rial on t h e r ec o rd in d ic at e s t h at t h e F r en ch o ffi ci al s ou r ce sh ar ed in f or m at i on wit h t h e In d i an G o v e rn m en t wit h r es p e ct t o ac c ou n t s h eld in HS BC B an k . Pr im a fa ci e , su ch m at er ial d i s cl o s ed t h a t t h e as s e s s e e wa s an at t or n ey o f s om e a c c ou n t h ol d e r . In t h e C ou r t ' s op i n ion , i f t h e a s s es s e e r eal ly h ad n o c on n e ct i on wit h su c h a cc ou n t s , n o p r ej u d ic e c ou ld re all y h av e en su e d t o h im i f h e w ou ld h a v e c o m p li e d w it h t h e n ot ic e u n d e r S e ct i on 1 4 2 ( 1) o f t h e A ct an d fil ed t h e c on s en t f or m .
In t h e s e ci r cu m st a n c e s, t h e p en alt y c an n o t b e h e ld t o b e e r r on e ou s o r u n wa r ran t e d . N o q u e st i on of l aw a ri s e s. Th e a p p eal s a r e d i s m is s ed . "
3 6 . A s s e s s e e ag g r i e v ed wit h t h e o r d er o f t h e H on Hig h c o u rt ch all en g ed t h e sa m e b ef o r e H o n o ra b l e S u p r e m e C o u rt b y f ilin g sp e cia l le av e p et it i on . H on o rab l e su p r em e c ou rt vid e S p e cial L ea v e t o A p p e al ( C) N o( s) . 1 5 8 2 8 - 1 5 8 2 9/ 2 0 1 8 o n 1 0/ 7 2 0 1 8 h as d i sm is s e d it . In vi e w o f t h is n o w , t h e i s su e is s q u a r el y c o v er e d ag ain st t h e a ss e s s e e .
3 7 . I n vi e w o f t h i s an d r e sp e ct fu ll y f ol l ow in g t h e d e ci si on o f H on ou r ab l e D elh i h ig h c ou rt in ca s e of M r. S an j a y D ala m ia wh e re in t h e p en alt y u / s 2 7 1 ( 1 ) ( b ) o f t h e a ct is u p h e ld f o r all t h e s e s e v en y ea r s a ri sin g ou t o f t h e sa m e s ea r ch an d r el at in g t o t h e sam e b a n k a cc ou n t an d f o r t h e s am e r ea s on of n ot fil in g t h e co n s en t let t e r, w e als o c on f ir m t h e p en al t y l e vi ed b y t h e ld A O f o r al l t h e s e s e v en y e a rs u / s 2 7 1 ( 1) ( b) of t h e act in ca s e of 34 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia t h e ap p el lan t . W e als o u p h old t h e o r d e r o f t h e ld CI T ( A ) f o r al l t h e s e s ev en y ea r s c on fi r m in g t h e p en al t y l e vi ed u / s 2 7 1 ( 1) ( b ) o f t h e act o f R s 1 0, 0 0 0/ - f o r e ach y ea r .
3 8 . A c c or d in g l y all t h e s e v en ap p eal f il e d b y t h e as s e s s e e a r e d i sm i s s ed ."
3. Aggrieved with the above mentioned order, the assessee filed Miscellaneous Application under Rules 34A of the ITAT Rules, 1963. The M.A. of the assessee is as under:
"D u rin g t h e ap p e lla t e p r o c ee d in g s on 2 7/ 0 9 / 2 0 1 8 , t he ap p el lan t rai s ed t h e i s su e o f r ea s on ab l e c au s e u / s 2 7 3 B of t h e A ct for n ot s u b m it t in g t h e c on s e n t w ai ve r f o r m in r e sp on se t o t h e n ot i c e is su ed u / s 1 4 2 ( 1) o f t h e A ct an d p r e s en t e d va ri ou s i s su e s d e m on st r at in g t h e b on a fid e of the ap p ell an t i n su p p o rt o f h e r c on t en t i on s. H o w ev e r , th e H on ' b le B en ch h a s n ot a d j u d i cat e d t h e issu e o f b on a fid e r ea s on a b l e c au se u / s 2 7 3 B of t h e A ct in t h e ap p ell at e or d er a s t h e p en al t y u / s 2 7 1 ( 1) ( b ) o f t h e A ct i s n o t im p o sab l e wh e re su ch r e as on ab l e cau s e exi st s .
2. Th e H on 'b l e B en ch h as g iv en a fin d in g in p a ra 20 p ag e 2 6 an d p ar a 2 3 p ag e n o . 2 7 of t h e ap p e llat e o rd e r t h at t h e a p p ell an t h ad t h e c op y o f t h e i m p u g n e d in f o r m at i on o f t h e al l eg ed HS BC Ban k a cc o u n t at t h e t i m e o f s ea r ch in h e r p r e m is e s on 2 0 t h an d 2 1 s t J a n u a ry , 2 0 1 2 w h e r ea s t h e fa ct is t h at n eit h e r t h e sai d in f o rm at i on w a s f ou n d in h e r p r e m is e s n o r t h e r ev e n u e o f fi c e r g a v e h e r a c op y o f t h e sa m e t h en . Ad m i t t ed l y , t h e sam e wa s g i v en t o h e r b y t h e A s s es sin g O ffi c e r d u rin g t h e c ou r s e o f t h e as s e ss m en t p r o c e ed in g s on d e m an d m u ch a ft e r t h e i s su e of t h e i m p u g n e d sh ow ca u s e n o t ic e on 2 6/ 0 9 / 2 0 1 3 f or im p o sit i on o f th e p en a lt y u / s 2 7 1 ( 1) ( b ) of t h e A ct f o r fil in g r e p ly b y 3 0/ 0 9/ 2 0 1 3 . It wa s al s o sh o wn d u rin g t h e h e a rin g t h a t ev en t h e all eg ed i n f o rm at i on wit h t h e r e v en u e c l ea rl y sh ow s t h at t h e all e g ed b an k d id n ot h av e t h e sig n atu r e o f t h e a p p ell an t wit h it an d sh e h a r d ly t ra v ell ed o v e rs e as a s i s m ent i on e d in t h e a ll eg ed in f o rm at i on wit h t h e r e v en u e . Th u s, it wa s c at eg o ri call y su b m it t ed t h a t sh e c or r e ct l y d en i e d an y k n owl e d g e of t h e im p u g n ed HS B C Ba n k a c c ou n t as sh e n e v er sig n ed an y p ap e r s f o r t h e sa m e. H o w ev er , t h e H on ' b l e Be n ch d id n ot c on s i d e r t h e sa m e in t h e ap p ell at e o rd e r w h ich ot h e r wi se 35 MA Nos. 31 to 37/Del/2019 Jayanti Dalmia p r o v es her b on a fid e r ea s on ab l e cau s e u/s 273B of the A ct for not im p o sin g t h e p en al t y u / s 2 7 3 B o f t h e A c t an d wo u ld h av e t ilt ed t h e d e ci si on in h e r fa v o u r .
3. It i s al s o u n d is p u t e d t h a t w h il e is su in g t h e i m pu g n e d s ol e n o t i c e u / s 1 4 2 ( 1) o f t h e A ct on 1 8 / 0 7/ 2 0 1 3 cal lin g f o r t h e c on s en t f o rm f r o m t h e ap p el lan t , t h e r e v en u e v e r y w e l l k n ew an d rat h er c on c eal ed t h e in f o rm at i on wh ich w as wit h it f r om t h e as s e ss e e an d w it h o u t c on fr on t in g t h e s am e t o t h e ap p el lan t , t h e r e v en u e p r o c e ed ed t o i m p o s e a p en alt y i n vi olat i on o f t h e p rin cip l e s o f n at u ra l j u s t ic e a s ha s b e en h el d b y t h e A p e x Co u r t in A n d am an Tim b er In d u st ri e s 2 8 1 C TR 2 4 1 ( S C ), K i sh an ch an d Ch ella r am 1 8 5 I TR 7 1 3 ( S C) an d a r e c en t j u d g m en t of t h e A p ex C ou rt in S u n it a Bh ad d a 2 0 1 8 - T I OL- 2 1 2 - S C - I T ( S L P ( Ci vil ) n o . 9 4 3 2/ 2 0 1 8 d at e o f j u d g m en t 2 8/ 0 3 / 2 0 1 8) t h a t an y ac t i on o f t h e r e v en u e wit h ou t c on f r on t in g t h e e vid en c e in it s p o s s es si on t o t h e a c cu s e d o r cha rg e d p e r s on is b ad in law . Th u s, t h e o r d e r n e e d s r ec t if ic at i on in li n e of t h e d i r e ct i on s o f t h e H on 'b l e A p e x C ou r t as ab o v e. M en t i on in g s o m e n u m b e rs in t h e im p u g n ed n ot i c e u / s 1 4 2 ( 1) o f t h e A ct can n ot at b e ca ll ed g i vin g a c o p y o f t h e sa m e wh er e fu l l d et a il s a n d m an y ot h e r p ar t icu l a rs w e r e m en t i o n ed an d wh i ch w er e d e fin i t ely in f a vo u r o f t h e ap p ell an t .
4. It w as al s o su b m it t ed t h a t t h e ap p ell an t i s a sep ar at e as s e ss e e ot h e r t h an h e r h u sb an d an d b r ot h e r in law an d an y kn o wl e d g e t o an y o f t h e m a b ou t t h e all e g ed in fo r m at i on can n ot b y it s el f b e c on sid e r ed a s in h e r k n ow l ed g e al s o.
5. Th e H on 'b l e I TA T has put the on u s on the as s e s s ee wit h ou t ad d r e ssi n g t h e c on t en t i on o f t h e ap p el l an t a s t o what h ad p r e v en t ed t h e r ev e n u e t o sh a r e a p h ot o c op y o f t h e sa id in f or m at i on w it h t h e ap p e llan t b e f o r e t ak in g an y a d v e rs e c og n iz an c e f o r n o n - s u b m i ssi on o f t h e c on s en t f or m b a s ed on t h e sai d in f o rm at i on on ly. Had a c o p y o f t h e s am e b e en g iv en t o t h e a p p ell a n t b ef o r e im p o sin g t h e p en alt y , t h e sa id c on t en t i on of n o k n owl e d g e w ou l d h a v e b e en p r o v ed f r om t h e s aid d oc u m e n t i t s el f a s wa s sp e ci fi call y p o i n t ed ou t d u rin g t h e c ou r s e o f h ea ri n g a ls o . Th e a ct i on o f t h e r ev en u e r e m in d s t h e fam ou s ch ild h o o d s t o r y of lion an d l am b d rin k in g wat e r f ro m a ri v e r wh e r e t h e li on in an y ca s e wa s d et e r m in ed t o k ill t h e lam b .36 MA Nos. 31 to 37/Del/2019
Jayanti Dalmia
6. No d ec is i on h a s b e en g iv en o n t h e p l e a of t h e a p p ell an t t h at t h e im p u g n ed o rd e r h a s b e e n p as s ed a ft e r e xp i r y o f m o r e t h an 1 5 m o n t h s f ro m t h e la st d at e o f h ea rin g of t h e i m p u g n ed p en al t y p r o c e ed in g s wh i ch w er e v er y w el l r e sp on d ed b y t h e ap p e ll an t .
7. It is a s et t l e d la w t h at b e f o r e t ak i n g ad v e r s e cog n iz an c e , t h e r ev e n u e m u st c on f r on t the c om p l et e in f o rm at i on as it h as , to the as s e ss e e t o en ab l e t h e as s e s s ee t o m e et h e r ca s e o f n o n - im p o sit i on of p en alt y d u e t o r ea s on a b l e c au s e .
8. Th e c on t en t i on t h a t t h e d o cu m en t sh ow n at t h e t im e o f s ea r ch can n ot b e eq u at ed wit h a n ot i on t h a t t h e sam e wa s a vail ab l e wit h t h e as s e ss e e . I t i s n ot cl ea r a s t o wh at wa s sh own t h e n w h et h e r t h e fu l l in f o rm at i on of 6 p a g e s a s is m en t i on ed in t h e a s s ess m en t o rd e r ( P B p ag e n o s. 2 0 0 t o 2 0 6) all eg ed ly r el e van t t o t h e a s s e ss e e o r wh at wa s a vail ab l e wit h t h e r e v en u e t h en an d g i v en lat e r t o t h e a ss e s se e wa s t h e sam e .
9. Th e as s e s s e e c on t e n d e d t h at t h e in f o r m at i on g i v en in t h e n o t i ce d at ed 1 8/ 0 7/ 2 0 1 3 wa s j u st some n u m b e rs an d n ot the c om p l e t e in f o rm at i on a s h a s b e en r ep r od u c ed in t h e a s s es s m ent or d e r , t h u s in n o ca s e it c an b e sa id t h at t h e sa m e wa s t h e s am e .
10. Th e r e v en u e in s t e ad of ad d r e s sin g t h e d if fi cu lt y o f t h e as s e s s e e p u t t h e en t i r e b u rd en on t h e as s e ss e e an d n ot h in g wa s c on sid e r ed as t o t h e a p p li ca b ilit y o f t h e s e ct io n 2 7 3 B o f t h e A ct b y an y au t h o rit y a s su ch .
11. It h a s b e en st at ed in p a r a 2 0 o f t h e o r d e r t h at i f t h e a s s e s se e d i d n ot h av e an y a c c o u n t sh e sh ou ld h a v e g i v en t h e c on sen t f o rm . Th e as s e ss e e c at eg o ri ca lly st a t ed t h at sh e d id n ot h av e an y a c cou n t , a fa ct , wh i ch t h e im p u g n e d in f o r m at i on wi t h t h e r e v en u e al s o p r ov e s t h at sh e d id n ot h av e an y k n o wl ed g e o f an y su ch a c c ou n t an d t h is b y it s elf t e st i fi e s t h at t h e r e wa s a b o n a fid e r e a s on t o r e fu se t o g i v e an y co n s en t f or m in r e sp e ct of an y o f t h e al l eg ed 4 b an k ac c ou nt s m en t i on e d in t h e im p u g n ed n ot ic e . I n fa ct , e v en in t h e as s e ss m en t o rd e r r e fe r en c e h as b e en made to only on e ac c ou n t ou t of the fo u r m en t ion e d in the im p u g n ed n o t ic e . T h u s , t h e n ot i c e w as j u st a cu t and p as t e p r o c e ed in g s wit h ou t ap p li cat i on o f m in d .37 MA Nos. 31 to 37/Del/2019
Jayanti Dalmia
12. Th e a d v e r s e fin d i n g t o t h e ap p el lan t h as b e en a v er r e d b y t h e H on 'b l e B en ch on t h e b a si s o f p r ej u d i c e ig n o rin g t h e la w o f t h e lan d t h a t t h e c od i fi ed la w on l y h as t o b e ap p li ed an d n ot on m o rali t y wh i ch c o v e rs t h e p r ej u d ic e .
13. Th e m o st i m p o rt a n t is su e t h at t h e a ll eg ed b an k a c c ou n t d o e s n ot h av e an y n a m e of t h e b an k t h e r e on n o r t h e s am e h a s b e e n c e rt i fi ed b y t h e b an k o r ev en t h e F r en ch au t h o r it y fr o m wh o m t h e s a m e h as b e en cla im ed t o h a v e b e en r ec e iv ed b y t h e r ev en u e . In s uch ca s e , s e ek in g in f o rm at i on f r om t h e a s se s s e e t o c on fi r m t h e ve r a cit y o f t h e s am e can n ot b e a r e a so n t o im p o s e p en a lt y f o r n on - c om p lian c e a nd t h e r ev en u e c ou l d n ot c oll e ct an y in f or m at i on f ro m t h e a s s e ss e e t o c reat e an e vid en c e s o as t o b e a r ea s on a b l e cau s e t o i m p o s e p e n alt y on n o n - su b m i s si on . Th e c op y of the im p u g n e d in f o rm at i on r ec e iv e d all eg ed l y from s om e F r en ch au t h o rit y c lai m in g to be of the HS B C S w is s b an k p e rt ain in g to the as s e ss e e wa s al so n e v e r c on f r on t ed t o t h e a ss e s s e e on h e r d en i al o f t h e all eg ed b an k a c c ou n t in t h e r ep ly d at e d 2 2/ 0 7/ 2 0 1 3 . Th e r ev e n u e sh ou l d h av e c on f r on t ed t h e s am e t o t h e ap p el l an t on su c h d en ial .
14. In p a ra 17 on p ag e 2 1 of the o rd e r , t h e H on 'b le B e n ch has m en t i on ed t h at t h e a ss e s sin g of fi c e r m en t i on ed in th e i m p u g n ed n ot i c e d at ed 1 8 / 0 7/ 2 0 1 3 t h at in c as e t h e as s e ss e e d i d n o t h av e t h e b an k ac c ou n t st a t em en t o f t h e said b an k t h en h e c ou ld h elp t h e a s s e ss e e t o ob t ain t h e sa m e. T h u s , h e c at eg o ri cal ly av e r r ed t h at in c as e of n on - ava ilab ilit y o f t h e b an k st at e m en t o f t h e as s e s s e e's a cc ou n t , t h e c on s en t f or m wa s t o b e fil ed an d n ot wh en t h e r e wa s n o su ch b an k acc ou n t wh i ch t h e a s s e ss e e h a s b e en ab l e t o sh ow , t h ou g h w it h ou t ad m i t t in g an y su ch ac c ou n t t h a t wa s e v e r in h e r k n o wl ed g e .
15. It wa s su b m it t ed t h at wh en sh e d id n o t h av e any b an k a cc ou n t sh e c ou ld n ot g iv e an y con s en t fo r m f o r an y b an k ac c ou nt wh i ch d id n o t b el on g t o h e r .
16. Th e r e v en u e n e v e r d is ch ar g ed t h e o n u s sh i ft ed on it aft e r h e r c om p l et e d en ial b y p r o vin g it s ca s e. In fa ct , e v en a ft e r m o r e t h an 5 y ea r s sin c e t h en t h e r e v e n u e h as st ill n ot b e en ab l e t o p r o v e e x ist en c e o f an y su ch b an k a c c ou n t o f t h e ap p ell an t ."38 MA Nos. 31 to 37/Del/2019
Jayanti Dalmia
4. Heard the arguments of both the parties and perused the material available on record.
5. We have gone through the entire factual matrix of the issue. The main grievance of the assessee in the M.A. revolves around reasonable cause u/s 273B of the Act. The same provision of the Act has been examined in detail, dealt and adjudicated by giving due credence to the arguments of the assessee. Para 11 and Para 17 of the order of the ITAT clearly proves that the issue has been deliberated considerably. Hence, there is no prima facie case could be made by the assessee to demonstrate a "mistake apparent from record" in accordance with the provisions of Section 254(2) of the Income Tax Act.
6. Hence, the Miscellaneous Applications of the assessee are liable to be dismissed.
Order Pronounced in the Open Court on 20/01/2022.
Sd/- Sd/-
(Kul Bharat) (Dr. B.R.R. Kumar)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Dated: 20/01/2022
*Subodh Kumar, Sr. PS*
Copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(Appeals)
5. DR: ITAT
ASSISTANT REGISTRAR