2018 (6) TMI 540 - AT - Income Tax

Penalty u/s. 274 r.w.s. 272(2)(c) - not furnishing the information called for u/s 133(6) - Held that - The assessee has not offered any valid reason for not furnishing the information called for u/s 133(6) - many of the notices issued by the ITO were never responded to by the assessee - thus following the judgement in case of Kakoor Service Co- operative Bank Ltd. 2018 (1) TMI 548 - ITAT COCHIN Tribunal has decided the issue in favour of the Revenue and has held that the order passed u/s.272A(2)(c) of the Act is valid - Decided against the assessee.

Issues Involved:
1. Jurisdiction of Income Tax Officer (Intelligence) to issue notice under Section 133(6) of the Income Tax Act.
2. Validity of the penalty order under Section 272A(2)(c) in terms of limitation under Section 275(1)(c).
3. Reasonable cause for non-furnishing information under Section 133(6) as per Section 273B.

Issue-wise Detailed Analysis:

1. Jurisdiction of Income Tax Officer (Intelligence) to issue notice under Section 133(6) of the Income Tax Act:

The appellant contended that the Income Tax Officer (Intelligence) is not authorized to call for information under Section 133(6) of the Income Tax Act, which should be vested only with the Assessing Officer, Deputy Commissioner, Additional Commissioner, or Commissioner (Appeals). The Tribunal referenced the judgment of the Hon’ble Supreme Court in the case of Kathiroor Service Co-operative Bank Ltd. vs. Commissioner of Income Tax and others, which affirmed that the ITO (Intelligence) has the authority to issue such notices after obtaining necessary approval from the Director of Income Tax (Intelligence). The Tribunal concluded that Section 133(6) allows the department to call for information useful for any proceeding under the Act, including general inquiries to identify persons with taxable income. Therefore, the ITO (Intelligence) had the jurisdiction to issue the notice under Section 133(6).

2. Validity of the penalty order under Section 272A(2)(c) in terms of limitation under Section 275(1)(c):

The appellant argued that the penalty order was time-barred under Section 275(1)(c). However, the Tribunal clarified that Section 275(1)(c) prescribes the time limit for imposing penalties as six months from the end of the month in which action for imposition of penalty is initiated. In this case, the penalty proceedings were initiated on 12.08.2014, and the penalty order was passed on 19.09.2014, well within the prescribed time limit. Thus, the Tribunal held that the penalty order was valid and not barred by limitation.

3. Reasonable cause for non-furnishing information under Section 133(6) as per Section 273B:

The appellant claimed that there was a reasonable cause for not furnishing the information sought under Section 133(6). The Tribunal noted that the assessee did not provide any valid reason for the non-compliance and observed a lack of cooperation and response to the notices issued by the ITO (Intelligence). Since no reasonable cause was established under Section 273B, the Tribunal upheld the penalty imposed under Section 272A(2)(c).

Conclusion:

The Tribunal dismissed the appeal, affirming the CIT(A)'s order upholding the penalty imposed under Section 272A(2)(c) of the Income Tax Act. The Tribunal found that the ITO (Intelligence) had the jurisdiction to issue the notice under Section 133(6), the penalty order was not time-barred, and no reasonable cause was shown for non-compliance. The appeal was dismissed in favor of the Revenue, consistent with previous Tribunal decisions in similar cases.

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