2019 (7) TMI 658 - AT - Income Tax

Penalty u/s 272A(2)(c) r.w.s. 274 - assessee did not furnish the details called for under the notice issued u/s 133(6) - HELD THAT - On identical facts the Cochin Bench of the Tribunal in the cases of Kakoor Service Co-operative Bank Ltd. 2018 (1) TMI 548 - ITAT COCHIN the assessee has not offered any valid reason for not furnishing the information called for u/s 133(6) of the Act. Many of the notices issued by the ITO (Intelligence) were never responded to by the assessee. In many instances the AO has mentioned that when they had approached, the assessee Society, for seeking information u/s 133(6) there was total lack of co-operation on the part of the assessee society as well as threat (reference order imposing penalty u/s 272A(2)(c) in appeals. Since there is no reasonable cause furnished by the assessee as mentioned u/s 273B of the IT Act for non furnishing of information sought by the ITO(intelligence) u/s 133(6) of the Act, the order imposing penalty cannot be quashed. - Decided in favour of revenue.

Issues Involved:
1. Jurisdiction of the Income Tax Officer (I&CI) to issue notice under Section 133(6) of the Income Tax Act.
2. Timeliness of the penalty order under Section 272A(2)(c) in relation to Section 275(1)(c).
3. Validity of the penalty imposed under Section 272A(2)(c) for non-furnishing of information.

Detailed Analysis:

1. Jurisdiction of the Income Tax Officer (I&CI) to Issue Notice under Section 133(6) of the Income Tax Act:
The assessees contended that the Income Tax Officer (I&CI) was not authorized to issue notices under Section 133(6) of the Income Tax Act, which is a power vested in the Assessing Officer, Deputy Commissioner (Appeals), Additional Commissioner, or Commissioner (Appeals). The Tribunal referred to the Supreme Court judgment in the case of Kathiroor Service Co-op Bank Ltd., which clarified that Section 133(6) allows income tax authorities to call for information useful for any proceeding under the Act, even if no proceeding is pending. The amendment introduced by the Finance Act 1995, which added the words "enquiry or" before "proceeding," expanded this power. The Tribunal found that the ITO (Intelligence) had obtained the necessary approval from the Director of Income Tax (Intelligence) before issuing the notice, thus validating the jurisdiction.

2. Timeliness of the Penalty Order under Section 272A(2)(c) in Relation to Section 275(1)(c):
The assessees argued that the penalty order was time-barred under Section 275(1)(c) of the Income Tax Act. 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. The Tribunal noted that the penalty proceedings were initiated on August 12, 2014, and the penalty order was passed on September 19, 2014, which is within the prescribed time limit. Therefore, the Tribunal held that the penalty order was not time-barred.

3. Validity of the Penalty Imposed under Section 272A(2)(c) for Non-Furnishing of Information:
The assessees failed to furnish the required information under Section 133(6) despite multiple notices. The Tribunal referenced its earlier decision in the case of Kakoor Service Co-operative Bank Ltd., where it upheld the penalty imposed under Section 272A(2)(c) for similar non-compliance. The Tribunal found that the assessees did not provide any valid reason for non-compliance, and thus, the penalty was justified. The Tribunal also noted instances where the assessee societies showed a lack of cooperation and even issued threats to the officers.

Conclusion:
The Tribunal dismissed the appeals filed by the assessees, upholding the penalties imposed under Section 272A(2)(c) for non-compliance with notices issued under Section 133(6). The Tribunal also dismissed the stay applications filed by the assessees as infructuous since the appeals were disposed of. The decision was pronounced on July 8, 2019.

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