9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (12) TMI 984 - AT - Income TaxPenalty u/s 271 - non furnishing of the returns as required under section 139(1) - CIT(A) passed the order under section 154 confirming the penalty levied by the AO - HELD THAT - There are two views are possible on the issue one is in favour of the assessee and the other one is against the assessee. When the two views are possible on the same issue and the issue which needs to be decided after debate and deliberations it is not permitted to make the rectification section 154 of the Act. It is settled issue that under section 154 of the Act, the authorities are permitted to rectify the mistake which is apparent from the record and in the instant case, there was no mistake which is apparent from the record and the issue required to be discussed deliberately and consider various case laws. Therefore, we hold that the order passed by Ld. CIT(A) u/s 154 is bad in law and unsustainable. Accordingly, we the cancel the order passed under section 154 of the Act and restore the original order dated 19-4-2018 and allow appeal of the assessee. Penalty u/s 271F - assessee could not file the return of income because of preoccupation of the employment - HELD THAT - The department has not made out the case that the assessee required to pay tax which remained unpaid. The income tax return was refund return and the order of Hon ble ITAT, Kolkata in the case of Mrs. Manju Kataruka vs. ITO 2004 (4) TMI 262 - ITAT CALCUTTA-B held that when there was a refund due, non filing of return of income within specified time u/s. 139(1) of the Act has to be considered as a bonafide belief and the said bonafide belief is to be treated as reasonable cause for non furnishing the return before the end of the assessment year. Considering the all the facts of the case that the assessee has filed the return of income within time allowed u/s. 139(4) of the Act, the return being refund return, the decision of Hon ble High Court of Bombay in the case of Trustees of Tulsidas Gopalji Charitable and Chaleswar Temple Trust vs. CIT 1993 (9) TMI 75 - BOMBAY HIGH COURT we hold that there is no case for levy of penalty u/s. 271F of the Act. - Decided in favour of assessee.
Issues Involved:
1. Validity of penalty under section 271F for non-filing of return within the due date specified under section 139(1). 2. Legitimacy of the rectification order under section 154 reversing the initial decision of the CIT(A). Issue-Wise Detailed Analysis: 1. Validity of Penalty Under Section 271F: The assessee did not file returns within the due dates specified under section 139(1) for the Assessment Years (AYs) 2012-13, 2014-15, 2015-16, and 2013-14. The Assessing Officer (AO) issued show cause notices and subsequently levied a penalty of ?5,000 for each assessment year under section 271F of the Income Tax Act, 1961, citing the failure to file returns within the prescribed time. The assessee contended that the delay was due to his employment commitments, including foreign assignments, and that his income was subject to Tax Deduction at Source (TDS), resulting in refunds rather than tax dues. He argued that returns filed under section 139(4) should be considered as filed within the time prescribed under section 139(1), relying on the Bombay High Court decision in Trustees of Tulsidas Gopalji Charitable and Chaleswar Temple Trust vs. CIT. The CIT(A) initially accepted the assessee's argument, canceling the penalty based on the Bombay High Court's interpretation that returns filed within the time specified under section 139(4) should be treated as filed within the time limits of section 139(1). 2. Legitimacy of the Rectification Order Under Section 154: Subsequently, the AO filed a rectification petition under section 154, and the CIT(A) reversed his earlier decision, upholding the penalty. The rectification order cited the Supreme Court decision in Prakash Nath Khanna vs. CIT, which emphasized that filing returns under section 139(4) does not mitigate the failure to file within the time specified under section 139(1). The Tribunal examined whether the rectification under section 154 was appropriate. It noted that the CIT(A) had initially relied on a valid judicial precedent (Bombay High Court) and later reversed his stance based on another precedent (Supreme Court), indicating two possible views on the issue. The Tribunal emphasized that section 154 allows rectification only for mistakes apparent from the record, not for issues requiring debate or deliberation. Given the conflicting judicial interpretations, the Tribunal held that the rectification order was not justified and restored the original order of the CIT(A) dated 19-04-2018, which had canceled the penalty. Conclusion: The Tribunal concluded that the penalties under section 271F were not justified as the assessee had filed returns within the time allowed under section 139(4), and there was no loss to the Revenue. The Tribunal also found the rectification order under section 154 to be invalid, as it involved a debatable issue rather than a clear mistake. Consequently, all four appeals filed by the assessee for the AYs 2012-13 to 2015-16 were allowed. Order Pronouncement: The Tribunal pronounced the order in the open court on 20th December 2019, allowing the appeals and canceling the penalties levied under section 271F.
|
