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TMI Blog2020 (3) TMI 537X X X X Extracts X X X X X X X X Extracts X X X X ..... earlier Directors, the Central Excise Department had conducted a search at the premises of the assessee-company on 08.07.2003. The earlier Directors were not associated with the assessee-company s matters subsequent to their retirement and were not aware of the assessments completed and consequent penalty levied. Being unaware, the ex- Directors did not represent the matters either in quantum proceedings or in penalty proceedings. The present Directors of the assessee-company has faced financial difficulties and labour unrest, and the same is evident from the documents produced before the Tribunal. Consequent to labour unrest and the financial difficulties faced by the present Directors, they also could not represent before the first ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Directors along with affidavits of the ex-Managing Directors stating therein that the quantum assessments and penalty orders were passed subsequent to their retirement and was not aware of the assessments and penalty proceedings till the ex-Directors received the recovery notices for penalty imposition u/s 271(1)(c) of the I.T.Act. At the insistence of the Bench, the present management of the assessee-company filed revised Form No.36 along with condonation petitions and affidavits of the present Managing Directors stating therein the reasons for belated filing of appeals. The reasons stated by the present Managing Directors for belated filing of the appeals read as follow:- (i) The company has been incurring continuous losses since its& ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er was posted for hearing. (vi) By the time the order of penalty was passed viz. 19.01.2018, the Company was facing proceedings under the SARFAESI Act and the Debt Recovery Tribunal had already issued recovery notices. Apart from this, the Company was facing great labour unrest, disabling the Directors from entering the premises and overseeing the day to day work. (vii) The Honorable High Court of Kerala through an order dated 11.08.2015 had appointed an Advocate Commissioner to assess the value of the property of the Company for meeting its liabilities and thereafter through an order dated 10.11.2017 directed sale of the property. Thus during the years 2015 to 2019 the Company faced formidable difficulties, disabling the Director ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se appeals are condoned and we proceed to dispose of the same on merits. 4. Identical grounds are raised in these appeals and they read as follow:- 1. Assessment was done not on the basis of any books of accounts, but purely on estimation basis. 2. The Appellant had not concealed any particulars of Income. 3. The Appellant is not aware about the reason for the excess cash or other incriminating documents seized from the Company at the time of raid. 4. Till the date of director's resignation, the appellant company had maintained the books of accounts, records and related documents properly and were flawlessly updated. 5. Ex- Directors of the appellant Company are facing severe financial crisis. The imposition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 001 to 2014-2015 and imposed penalty u/s 271(1)(c) of the I.T.Act. The details of the penalty imposed are as follows:- Asst.Year Penalty amount u/s 271(1)(c) 2000-01 5,45,376 2001-02 6,45,864 2002-03 3,79,442 2003-04 6,73,970 2004-05 5,58,809 Total 28,03,461 7. Aggrieved by the orders imposing penalty u/s 271(1)(c) of the I.T.Act, the assessee preferred appeals to the first appellate authority. There was no representation by the assessee before the first appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are separate from the quantum assessments and if the assessee can prove in penalty proceedings that the additions in the quantum assessments are not warranted, necessarily, the penalty imposed has to be deleted. Since the assessee has not been represented before the first appellate authority with regard to the penalty proceedings, in the interest of justice and equity, we are of the view that as a last chance, the assessee should be granted one more opportunity of being heard. The assessee shall cooperate with the Department and furnish necessary documents and evidences to prove its case. For the above said purpose the issue is restored to the CIT(A). It is ordered accordingly. 10. In the result, the appeals filed by the assessee are par ..... X X X X Extracts X X X X X X X X Extracts X X X X
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