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TMI Blog2023 (9) TMI 610X X X X Extracts X X X X X X X X Extracts X X X X ..... For the Assessee : Shri R.B Doshi, CA For the Revenue : Shri Satya Prakash Sharma, Sr. DR ORDER PER BENCH : The captioned appeals filed by the assessee are directed against the order passed by the CIT(Appeals), National Faceless Appeal Centre (NFAC), Delhi, dated 08.03.2023, which arises from the order passed by the A.O. u/s. 271(1)(b) of the Income-tax Act, 1961 (for short Act ), dated 27.07.2015 for A.Ys.1993-94, 1994-95 1995-96. As a common issue is involved in the captioned appeals, the same are being taken up and disposed off through a consolidated order. 2. We shall first take up the appeal filed by the assessee in ITA No.144/RPR/2023 for the assessment year 1993-94 as the lead matter, and the order therein passed shall mutatis-mutandis apply to the remaining appeals. The assessee has assailed the impugned order on the following grounds of appeal before us: 1. Ld. CIT(A) erred in confirming penalty of Rs. 60,000/- imposed by the A.O u/s. 271(1)(b). The penalty imposed by the A.O and confirmed by CIT(A) is illegal and not justified. 2. Without prejudice to ground no.1 Ld. CIT(A) erred in confirming penalty without appreciating the fact tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - 01-02-2001 No compliance was made. 5. 142(1)(ii) 07-12-2001 03-01-2002 17-01-2002 Non compliance 6. Letter 142(1)(ii) 12-02-2002 20-02-2002 25-02-2002 Non compliance Also, notice u/s. 148 of the Act dated 30.03.2000 was not complied with by the assessee. 6. Considering the non-compliance of the assessee to the notices issued during assessment proceedings, the A.O. called upon him to explain why the penalty u/s. 271(1)(b) of the Act may not be imposed. As the explanation filed by the assessee did not find favor with the A.O., he vide order passed u/s. 271(1)(b) of the Act dated 27.07.2015 imposed a penalty aggregating to Rs. 70,000/- i.e @ Rs. 10,000/- for each of the seven defaults. 7. Aggrieved the assessee carried the matter in appeal before the CIT(Appeals). Although the CIT(Appeals) found favor with the claim of the assessee that penalty u/s. 271(1)(b) of the Act could not have been levied qua the failure on his pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant. The show-cause notices for imposition of penalty were issued as per the last known address available in records. This is an admitted position that the appellant had failed to intimate the change of address to the AO.' The appellant has not made a single compliance during the entire assessment proceedings-as also in.-the penalty proceedings. On these facts, I find that the appellant cannot take advantage of his own failure, namely to intimate his new address to the AO; and take recourse to the argument that penalty was imposed without providing any opportunity of being heard, thereby violating the principles of natural justice. It trite law that any legal right, including the right to be heard, can only be availed by those who are vigilante for their rights, and not by those who sleep over them. In the case at hand, it is the appellant who has not taken the due care to intimate the Department about his new address. Therefore, it is not open to the appellant to now raise an objection as to violation of procedure by the AO in imposing penalty. This ground of appeal is dismissed. 9. In Ground No.(3), the appellant has contended that the penalty order passed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... carried before the ITAT was appeal against the assessment order, which had nothing to do with the penalty proceedings. Penalty proceeding u/s 271(1)(b) were initiated for non compliance during the assessment proceeding and therefore, what was required to be seen while levying penalty under the above section is, whether there was any reasonable cause for the alleged non-compliance. The appeal against assessment order had no bearing upon the penalty proceedings for non-compliance of various notices and therefore, if there was appeal against the assessment order, there was no valid reason to keep the penalty proceedings pending till disposal of quantum appeal. The limitation period for imposition of penalty was extended only with reference to the penalty which was linked with the addition made, which was subject matter of appeal and since the penalty under consideration is not linked with the addition made, the limitation did not get extended. 3.6 Penalty u/s 271(1)(b) has nothing to do with the amount of addition/ disallowance made in assessment and the outcome in quantum appeal did not have any bearing upon penalty u/s 277(1)(b). Therefore, sub-clause (a) of section 275(1) is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee, being aggrieved with the order of the CIT(Appeals), has carried the matter in appeal before us. 9. We have heard the Ld. Authorized Representatives of both the parties, perused the orders of the lower authorities and the material available on record and considered the judicial pronouncement pressed into service by the Ld. AR to drive home his contentions. 10. At the outset, it was submitted by Shri R.B Doshi, Ld. Authorized Representative (for short AR ) for the assessee that the penalty imposed by the A.O u/s. 271(1)(b) of the Act was barred by limitation. Elaborating on his contention above, it was averred by the Ld. AR that as the time limit for imposing penalty u/s. 271(1)(b) of the Act was provided in Section 275(1)(c) of the Act; therefore, the penalty imposed by the A.O. vide his order dated 27.07.2015 was beyond the stipulated period and barred by limitation. On a specific query by the Bench that now when the penalty proceedings had been initiated by the A.O. while framing the assessment vide his order passed u/ss. 144/147 of the Act dated 15.03.2002, then how the same would not be governed by the time limit provided in clause (a) to sub-section (1) of Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r (Appeals) under section 246 or section 246A, and the Commissioner (Appeals) passes the order on or after the 1st day of June, 2003 disposing of such appeal, an order imposing penalty shall be passed before the expiry of the financial year in which the proceedings, in the course of which action for imposition of penalty has been initiated, are completed, or within one year from the end of the financial year in which the order of the Commissioner (Appeals) is received by the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner, whichever is later; (b) in a case where the relevant assessment or other order is the subject-matter of revision under section 263 or section 264, after the expiry of six months from the end of the month in which such order of revision is passed; (c) in any other case, after the expiry of the financial year in which the proceedings, in the course of which action for the imposition of penalty has been initiated, are completed, or six months from the end of the month in which action for imposition of penalty is initiated, whichever period expires later. (1A) In a case where the relevant assessment or other order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... immunity granted under section 245H remained in force; and (iii) any period during which a proceeding under this Chapter for the levy of penalty is stayed by an order or injunction of any court, shall be excluded. 13. Ostensibly, a perusal of the aforesaid statutory provision reveals that as per clause (a) of sub-section (1) to Section 275 of the Act, where the action for imposition of penalty is, inter alia, initiated in the assessment order, the time limit for imposing such penalty would be regulated by the mandate of the said clause, i.e. before expiry of the financial year in which the proceedings in the course of which action for the imposition of penalty had been initiated are completed; or six months from the end of the month in which the order of the Commissioner (Appeals) or, as the case may be, the Appellate Tribunal is received by the Principal Chief Commissioner or Chief Commission or Principal Commissioner or Commissioner, whichever period expires later. Further, vide the 1st proviso to Section 275(1)(a) of the Act, as had been made available on the statute vide the Finance Act, 2002 w.e.f. 01.06.2003, in a case where the relevant assessment order is, inter a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o sub-section (1) of Section 275 of the Act. We, thus, are of a firm conviction, that now when the penalty u/s 271(1)(b) had been initiated by the A.O in the course of the assessment proceedings, therefore, the same could validly be imposed as per the time limit provided in clause (a) of sub-section (1) of Section 275. 15. In so far the reliance placed by the Ld. AR on the order of ITAT, Lucknow in the case of ACIT Vs. Vaish Bros. Co. Ltd. (2005) 93 TTJ 476 ( Luck), the being distinguishable on facts would not assist the case of the assessee before us. In the aforesaid case, the issue before the Tribunal was the time limit for imposing penalty u/s. 271B of the Act. As the penalty in the case referred above, i.e. u/s. 271B of the Act can be independently initiated, therefore, for the said reason, the time limit for imposing the same can safely be related to clause (c) of sub-section (1) to Section 275 of the Act. However, as in the present case before us, the penalty in question, i.e. u/s. 271(1)(b) of the Act is inextricably interwoven with the framing of assessment, therefore, there can be no justification for reading a time limit for imposing the same other than that specifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ths from the end of the month in which appellate order was received ITAT order dated 17,12,2014, expired on 31.07.2015, therefore, the order dated 27.07.2015 imposing the aforesaid penalty was well within the limitation period. 17. We, thus, in terms of our aforesaid observations are unable to concur with the solitary contention advanced by the Ld. AR, i.e the penalty imposed by the A.O under Section 271(1)(b) was barred by limitation, and uphold the view taken by the lower authorities. Thus, the grounds of appeal raised by the assessee are dismissed in terms of our aforesaid observations. 18. In the result, the appeal of the assessee in ITA No.144/RPR/2023 for the assessment year 1993-94 is dismissed in terms of our aforesaid observations. ITA Nos. 146 148/RPR/2023 A.Ys.1994-95 1995-96 19. As the facts and issues involved in the captioned appeals remain the same as those before us in the case of the assessee in ITA No.144/RPR/2023 for the assessment year 1993-94; therefore, our order therein passed while disposing off the said appeal shall apply mutatis-mutandis for disposing the captioned appeals, i.e., ITA No. (s) 146 148/RPR/2023 for the assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X
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