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2014 (9) TMI 499 - HC - Income TaxPenalty u/s 271FA Protection u/s 273B - Proper information not furnished by assessee delay in furnishing the requisite AIR information by the appellant - bonafide ignorance - Limitation u/s 275(1)(c) Held that - The plausible explanations in terms of Section 273B of the Act in the cases of Sub Registrar, Talwandi Saboo, Sub Registrar, Lambi, Sub Registrar, Malout, Sub Registrar, Maur Mandi, Sub Registrar, Doda and Sub Registrar, Rampura Phul are also similar and therefore, the levy of penalty under Section 271FA of the Act cannot be faulted. The Joint Sub Registrar is also the prescribed authority for the sub-district in terms of sections 6 and 7 of the Registration Act, 1908. In the absence of any factual foundation having been laid before the Assessing Officer, the CIT(A) and the Tribunal regarding the levy of penalty on the Joint Sub Registrar, Sangat, the said plea raised for the first time before the High Court would not be permissible. Equally, the plea of no notice having been issued under Section 285BA(4) of the Act in ITA No.47 of 2014 to Sub Registrar, Malout loses significance in the absence of such contention having been raised before the authorities below. Assessee relies upon Price Waterhouse Coopers (P.) Ltd. Versus Commissioner of Income-tax, Kolkata 2012 (9) TMI 775 - SUPREME COURT - There was also no question of the assessee furnishing any inaccurate particulars. It was further noticed that the action of the assessee was bonafide and due to inadvertent error for which no penalty under Section 271(1)(c) of the Act could be imposed. The factual matrix being different in the present appeals, the learned counsel for the appellant cannot derive any benefit therefrom. - Decided against assessee.
Issues Involved:
1. Sustaining the penalty under section 271FA on a Joint Sub Registrar. 2. Delay in furnishing AIR information due to bona fide ignorance and multiple administrative reasons. 3. Applicability of section 273B in light of the appellant's bona fide ignorance and inadequate infrastructure. 4. Premature observations and findings by the Tribunal. 5. Levy of penalty beyond the time limitation prescribed under section 275(1)(c). 6. Violation of principles of natural justice by the Tribunal in a consolidated order. Detailed Analysis: Issue 1: Sustaining the Penalty Under Section 271FA The appellant, a Joint Sub Registrar, contended that the statutory obligation under Section 285BA(1)(d) of the Income Tax Act, 1961, is specifically cast upon the 'Registrar' or 'Sub Registrar' and not a 'Joint Sub Registrar'. The Tribunal, however, upheld the penalty imposed under Section 271FA, reasoning that the appellant was responsible for furnishing the Annual Information Return (AIR) and had failed to do so within the prescribed time. Issue 2: Delay in Furnishing AIR Information The appellant argued that the delay in furnishing the AIR information was due to bona fide ignorance of the statutory obligation under Section 285BA(1) and multiple administrative issues, including poor infrastructure, lack of computer-savvy staff, and the need to translate records from Punjabi to English. The Tribunal dismissed these arguments, stating that ignorance of law is not an excuse, and several notices had been served to the appellant, which were not complied with. Issue 3: Applicability of Section 273B The appellant claimed protection under Section 273B, which provides that no penalty shall be imposed if there is a reasonable cause for the failure. The Tribunal, however, found that the appellant was a habitual defaulter and had not provided a satisfactory explanation for the delay. The Tribunal emphasized that ignorance of law does not constitute a reasonable cause, referencing the Supreme Court ruling in Moti Lal Padampat Sugar Mills Co. Limited vs. State of Uttar Pradesh. Issue 4: Premature Observations and Findings The appellant contended that the Tribunal made premature observations and findings without considering the specific facts and grounds of appeal raised by the appellant. The Tribunal, however, maintained that the facts of the appellant's case were similar to those in the case of Sub Registrar, Bariwala, and thus, the findings in that case were applicable to the appellant's case as well. Issue 5: Levy of Penalty Beyond Time Limitation The appellant argued that the penalty was imposed beyond the time limitation prescribed under Section 275(1)(c). However, the Tribunal found no merit in this argument, as no such contention was raised before the lower authorities. Issue 6: Violation of Principles of Natural Justice The appellant claimed that the Tribunal violated the principles of natural justice by disposing of 39 appeals through a consolidated order, primarily relying on the facts of the case of Sub Registrar, Bariwala, without considering the specific facts of the appellant's case. The Tribunal clarified that the learned counsel for the appellant had agreed to argue the case of Sub Registrar, Bariwala as a lead case, and the facts of all other appeals were admitted to be identical. Conclusion: The Tribunal upheld the penalty under Section 271FA, rejecting the appellant's arguments of bona fide ignorance, administrative issues, and reasonable cause under Section 273B. The Tribunal found that the appellant was a habitual defaulter and that the principles of natural justice were not violated in the consolidated order. The appeals were dismissed, and no substantial question of law was found to arise.
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