Kanu Manilal Patel Daman

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IN THE INCOME TAX APPELLATE TRIBUNAL
“B” BENCH, AHMEDABAD

BEFORE SHRI MUKUL Kr. SHRAWAT, JUDICIAL MEMBER AND
SHRI ANIL CHATURVEDI ACCOUNTANT MEMBER

ITA Nos.2951, 2952, 2953, 2954, 2955 & 2956/Ahd/2011
A.Y.2003-04 to 2008-09

Kanu Manilal Patel, Vs ACIT, Central Circle-3,
17 Ambica Co-op. Surat.
Housing Society, Near
Gunjan Cinema, Daman.
PAN: ACCPP 2218B
(Appellant) (Respondent)

Revenue by : Shri Nimesh Yadav,
Sr.D.R..
Assessee(s) by : None

?????? ? ????/Date of Hearing : 10/03/2015
????? ? ???? /Date of Pronouncement: 20/03/2015

????/O R D E R

PER: MUKUL KUMAR SHRAWAT, JUDICIAL MEMBER

These six Appeals have been filed by the Assessee emanating from
a consolidated order of learned CIT(A)-II, Ahmedabad dated 22.09.2011
pertaining to A.Y.2003-04 to A.Y.2008-09. For all the years, a penalty of
Rs.10,000/- each was imposed u/s.271(1)(b) of IT Act. On the date of
hearing, no one has appeared from the side of the Appellant but
considering the trifle nature of dispute we have decided to proceed ex-
parte qua the Assessee, after hearing learned Sr.D.R. who has placed
reliance on the penalty order as well as the order of the First Appellate
Authority.

———————Page 2———————

ITA Nos.2951, 2952, 2953, 2954, 2955, 2956/Ahd/2011
Kanu Manilal Patel Vs. ACIT, Central Circle-3, Surat
For A.Y.2003-04 to 2008-09
– 2 –

2. As per the penalty order passed u/s.271(1)(b) of IT Act a
questionnaire was issued to the Assessee by the AO on 25.09.2009 which
was not attended. Thereafter, a notice u/s.271(1)(b) was also issued but
no one had attended. Later on, a reply was furnished by the Assessee
which was reproduced in the penalty order, relevant portion is as under:
“1. “Firstly, the details required to be submitted before your Honour
comprises for several years and are voluminous in nature and hence the
same could not be compiled on the date of hearing.
2. Secondly, my accountant is on leave for a period of one month on account
of marriage in his family and will resume the office in the second week of
December and for this reason also, the details could not be compiled on time.
3. Furthermore, your Honour may kindly note that my chartered accountant
& authorized representative are pre-occupied with the time barring scrutiny
assessment proceedings for A.Y. 2007-08 which are to be completed on or
before December 31, 2009, whereas the due date of the finalizing the subject
assessment is December 31, “201.0 and in that situation, the notice u/s.
142(1)/143(2) were not complied with.””

2.1 In the penalty order, an another reply of the Assessee has also
been reproduced as under:
“1. Your Honour may kindly note that my chartered accountant & authorized
representative are pre-occupied with the time barring scrutiny assessment
proceedings for A.Y. 2007-08 which are to be completed on or before
December 31, 2009 and accordingly, they are informing me that the details in
our case will be compiled by them in the mide of the January, 2010. Since,
our case is not getting time barred on 31.12.20009.
2. Further, your Honour may also appreciate that my accountant has just
resumed office after his leave and is in process of compiling data and since
the details required to be submitted before your Honour comprises for several
years and are voluminous in nature, some time up to second week of
January, 2010 may kindly be granted.”

3. However, the AO was not satisfied and held that the Assessee was
not attending the proceedings and did not intend to comply with the
notices; although a reasonable time of five months were given. Therefore
held that the Assessee was deliberately delaying the assessment
proceedings for all the years. A penalty of Rs.10,000/- for each year was
levied respectively for the default of failure to attend the proceedings.

———————Page 3———————

ITA Nos.2951, 2952, 2953, 2954, 2955, 2956/Ahd/2011
Kanu Manilal Patel Vs. ACIT, Central Circle-3, Surat
For A.Y.2003-04 to 2008-09
– 3 –

4. We have also perused the order of learned CIT(A) in which the
Assessee has placed on record the summary of events. In the said
summary, the Assessee has tried to explain the date-wise compliance
made during the course of assessment proceedings before the First
Appellate Authority, it was thus pleaded that the Assessee has requested
to grant an adjournment uptil the finalization of time barring assessments.
So the argument was that the Chartered Accountant, legal representative
of the Assessee, was preoccupied with the time barring assessment upto
December, 2009; therefore, time was sought; hence, it was wrong on the
part of the Revenue Department to allege that there was no reasonable
cause for seeking adjournment. Rather, from the side of the Revenue-
Department, learned Sr.D.R. has pleaded that the Assessee was a habitual
defaulter then the AO had no option but to levy penalty. Considering the
totality of the facts and circumstances as discussed hereinabove, we are
of the conscientious view that a tax payer should pay respect to the show
cause notice issued by the Revenue Department by promptly complying
the same. If there is a negligence or non compliance then the provision of
penal action has also been subscribed in the Act. Such type of penalty is
in the nature of deterrence to convey message that the notices of the
Revenue Department should be seriously complied with. But side by side
there is a provision of Section 273B of IT Act which says that no such
penalty is imposable on the Assessee on failure referred to in the said
provisions if proves that there was a reasonable cause for the said failure.
In the present case, although the Assessee has tried to demonstrate that
there was a reasonable cause but we are of the view that the Legal
Representative of the Assessee should have managed his affairs in such
manner that all the legal matters handled by him should be attended
efficiently. Therefore, we hereby hold that instead of deleting the entire

———————Page 4———————

ITA Nos.2951, 2952, 2953, 2954, 2955, 2956/Ahd/2011
Kanu Manilal Patel Vs. ACIT, Central Circle-3, Surat
For A.Y.2003-04 to 2008-09
– 4 –

penalty by taking the shelter of the provisions of Section 273B of IT Act
it is justifiable to reduce the fine imposed of Rs.10,000/- to Rs.5,000/-
each year. Resultantly, part relief is granted for all the years involved.
We order accordingly.

5. In the result, all the Appeals are partly allowed.

Sd/- Sd/-
(ANIL CHATURVEDI) (MUKUL Kr. SHRAWAT)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Ahmedabad; Dated 20/03/2015
Prabhat Kr. Kesarwani, Sr. P.S.s
???? ? ??? ? ???/Copy of the Order forwarded to :
1. ?????? / The Appellant
2. ?? / The Respondent.
3. ?????? ???? ???? / Concerned CIT
4. ???? ????(????) / The CIT(A)-III, Ahmedabad
5. ?????? ???, ???? ????? ?????, ???????? / DR, ITAT, Ahmedabad
6. ??? ???? / Guard file.
??????????/ BY ORDER,

??/????? ??????? (Dy./Asstt.Registrar)
???? ????? ?????, ???????? / ITAT, Ahmedabad

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