2019 (11) TMI 654 - AT - Income Tax

Penalties upheld for non-compliance with Income Tax Act summons

Sahara India Financial Corpn. Ltd., New Delhi Versus The Addl. Commissioner of Income Tax,

The ITAT upheld penalties imposed under Section 272A(1)(c) of the Income Tax Act for failure to comply with summons. The appeals were dismissed as the ... Penalty levied u/s 272A(l)(c) - deliberate default on the part of the appellant in making compliance to the requirements of summon u/s 131 - HELD THAT:- It is not in dispute that the assessee had submitted only partial details in the form of printouts in response to summons dated 12.10.2007 whereas no details were submitted (in the CD or in the form of printouts) in response to summons dated 12.09.2007. Thus, it is not in dispute that the assessee had failed to submit the full details required by the AO vide aforesaid summons dated 12.09.2007 and 12.10.2007 either in the form of CD or in the form of printouts. The perusal of the orders of the Addl. CIT and the CIT shows that the assessee had been provided several opportunities and despite that these required details were not submitted in entirety. Even if it is the case of the assessee, that there was no requirement to submit details in CD, and that submission in form of printout was sufficient; even then, the fact remains that there was absence of full compliance even in the form of printouts, and only partial compliance by way of submission in the form of printouts, has been made. Considering that aforesaid order dated 23.03.2008 of Co-ordinate Bench of ITAT, Delhi is distinguishable, as mentioned in foregoing paragraph (E) of this order; we have find that the aforesaid penalty levied by Ld. Addl. CIT, and confirmed by the Ld. CIT(A); was just and proper in the facts and circumstances of the appeals before us. Accordingly, penalties levied by the Addl. CIT and confirmed by the Ld. CIT(A) are hereby upheld. Appeal filed by assessee is dismissed. Issues Involved:1. Justification of penalty under Section 272A(1)(c) of the Income Tax Act.2. Alleged non-compliance with summons issued under Section 131 of the Income Tax Act.3. Consideration of reasonable cause under Section 273B of the Income Tax Act.Detailed Analysis:Issue 1: Justification of Penalty under Section 272A(1)(c) of the Income Tax ActThe primary issue in both appeals was whether the penalty of Rs. 10,000 levied under Section 272A(1)(c) of the Income Tax Act was justified. The Ld. CIT(A) confirmed the penalty imposed by the Addl. CIT, citing the assessee's failure to comply with the summons issued on 12.09.2007 and 12.10.2007. The penalty was upheld as the assessee did not submit the required details in the form of a CD or printouts, despite being provided several opportunities.Issue 2: Alleged Non-compliance with Summons Issued under Section 131 of the Income Tax ActThe assessee contended that there was no deliberate default in complying with the summons dated 12.09.2007 and 12.10.2007. The assessee argued that the initial summons became infructuous upon the issuance of the modified summons. The Ld. CIT(A) and ITAT found that the assessee failed to submit the required details in both CD and printout formats, leading to partial compliance. The ITAT noted that the information was voluminous but could have been retrieved quickly if maintained on a computer system.Issue 3: Consideration of Reasonable Cause under Section 273B of the Income Tax ActThe assessee argued that there was a reasonable cause for non-compliance under Section 273B, citing the voluminous nature of the information required and the operational structure involving multiple branches and agents. The Ld. CIT(A) and ITAT rejected this argument, stating that the assessee did not make full compliance even in printout form and that partial compliance could not be equated with non-compliance. The ITAT upheld the penalty, emphasizing that the assessee had several opportunities to comply but failed to do so.Conclusion:The ITAT upheld the penalties levied by the Addl. CIT and confirmed by the Ld. CIT(A) due to the assessee's failure to fully comply with the summons issued under Section 131. The arguments for reasonable cause under Section 273B were rejected, and the appeals were dismissed.Order:In the result, the appeals filed by the assessee are dismissed. Order pronounced in the open court on 07/11/2019.