1981 (3) TMI 105 - AT - Income Tax

Penalty set aside for PWD Contractor not given sufficient time to respond

The ITAT Calcutta set aside the penalty imposed on a PWD Contractor by the CIT, Jaipur for not submitting information on contracts, citing that the ... Penalty under s. 285A(2) for failure to furnish information - Compliance with requirement to furnish information under s. 285A(1) - Opportunity of hearing / audi alteram partem - Remand for fresh considerationPenalty under s. 285A(2) for failure to furnish information - Compliance with requirement to furnish information under s. 285A(1) - Opportunity of hearing / audi alteram partem - Remand for fresh consideration - Validity of the fine imposed under s. 285A(2) for alleged non-filing of information and adequacy of opportunity of hearing afforded to the assessee - HELD THAT: - The Tribunal found that on the material before it the assessee prima facie appears to have furnished the requisite information in Form No. 52 (delivery book supporting submission) in respect of the contracts alleged to be unreported, and that correspondence from the assessee (letter dated 2nd March, 1978) and the delivery evidence required consideration. The Tribunal also held that the show-cause notice was served on 21st January, 1980 with hearing fixed for 28th January, 1980, which, given the assessee's residence at a distant place and limited time to consult his tax adviser, did not afford a reasonable opportunity to be heard. In view of these factors the Tribunal concluded that the penalty order could not be sustained without fresh consideration and therefore set aside the CIT's order and restored the matter to the CIT's file for rehearing and decision in accordance with law after giving the assessee due opportunity of hearing. [Paras 3, 4]The order imposing the fine under s. 285A(2) is set aside and the matter is remitted to the CIT for fresh adjudication after affording the assessee a proper opportunity to be heard.Final Conclusion: Appeal allowed for statistical purposes; penalty order set aside and matter remanded to the CIT for fresh decision after giving due opportunity of hearing to the assessee. The ITAT Calcutta-A judgment involved Shri Varis Ali, a PWD Contractor, for the assessment year 1977-78. A fine was imposed by the CIT, Jaipur under s. 285A(2) of the Act for not submitting information on three contracts. The ITAT set aside the penalty order, stating that the assessee had provided the required information and was not given adequate time to respond. The matter was remanded to the CIT for a fresh decision, granting the assessee a fair hearing. The appeal of the assessee was allowed for statistical purposes.