Date Of Judgment 21-06-2018, Ita v. Dr. Vineet Kothari, J., Delivered The Following

IN THE HIGH COURT OF KARNATAKA, BENGALURU DATED THIS THE 21 DAY OF JUNE 2018 PRESENT THR HON’BLEK DR.JUSTICE VINBBT KOTHARI ANT) THR HON’BLE MRS.JUSTICEK S.SUJATHA I.T.A. No.695/2017 BETWEEN : 1.THE PR. COMMISSIONER OF INCOME TAX,CIT (A), 5[‘L]FLOOR, BMTC BUILDING, |80 FEET ROAD, KORAMANGALA,BBENGALURU-560 095.CIT (A), 5[‘L]FLOOR, BMTC BUILDING, |80 FEET ROAD, KORAMANGALA,BBENGALURU-560 095. «|THE INCOME TAX OFFICERWARD-95(3), PRESENT ADDRESS,WARD-2(2)(4), 2 FLOOR, ©BMTC BUILDING, 80 FEET ROAD,KORAMANGALA,BBENGALURU-560 095._ APPBLLANTS| (BY SRI K.V.ARAVIND, ADV.) AND : SMT.DEBPIKA|C/O M/s T.M.MARKETING (INDIA), 12, GROUND FLOOR, TULSI PLAZA,».V. LANE, 3 CRODS»s, CHICKPET,BBENGALURU-560 053.~ RESPONDENT THIS INCOME TAX APPEAL IS FILED UNDER SBCTION260-A|OF INCOME TAX ACT 1961, ARISING OUT OF ORDER DATED:09.03.2017,PASSED IN ITA NO.1618/BANG/2014, FOR THE.ASSESSMENT YEAR 2009-2010, PRAYING TO I. FORMULATE| Date of Judgment 21-06-2018, ITA No.695/2017 The Pr. Commissioner of Income Tax CIT (A) & another Vs. Smt.Deepika 2/5 THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE. II.|ALLOW THR APPBAL AND SBT ASIDE THR ORDERS PASSBD BY)THE INCOME-TAX APPELLATE TRIBUNAL, BENGALURU IN ITANO.1618/BANG/2014 DATED 09.03.2017 CONFIRMING THE.ORDER OF THR APPBELLATKE COMMISSIONBR AND CONFIRTHE ORDER PASSED BY THE INCOME TAX OFFICER, WARD-2(2)(4), BENGALURU & ETC. Dr. VINEET KOTHARI, J., DELIVERED THE FOLLOWING: THIS APPEAL COMING ON FOR ORDERS, THIS DAY, | JU DBiGMENT Mr. K.V.Aravind,Adv. for Appellants - Revenue This Appeal has been filed by the Revenue undersection 260-A of the Income Tax Act, 1961 |'Act’ forshort], raising certain alleged substantial question oflaw arising from the Order of the learned Income Tax.AppellateTribunal|dated9.3.2017passed1n I.T.A.Nos.1618/Bang/20141n‘The ITO vv. Smt.Deepika’for Assessment Year2009-10,setting asidethe penalty imposed on the Respondent-Assessee by theAssessing Authority. | Date of Judgment 21-06-2018, ITA No.695/2017 The Pr. Commissioner of Income Tax CIT (A) & another Vs. Smt.Deepika 3/5 a2Learned Counsel for the Revenue fairlysubmitted that controversy involved in this appeal issquarely covered by the Co-ordinate Bench Judgment ofthis Court in the case ot‘Commissioner ot Income Tax v. Manjunatha Cotton & Ginning Factory andOthers’ [2013] 359 ITR 565 [Karnataka], wherein it isheld as under: “Held accordingly, dismissing the appeals, (i) thatmerely because the assessee agreed to theaddition and the assessment order was passed|on the basis of this addition, when the assesseehad paid the tax and the interest thereon in theabsence of any material on record to show theconcealment of income, it could not be inferredthat the addition was on account of concealment.Moreover,the|aASSCSSCEhad|offeredan.explanation.The explanation was not foundto be false. On the contrary, it was held to bebona fide. The cancellation of penalty by the|Tribunal was justified. (u) That the Tribunal was justified in holding thatthe entire penalty proceedings were vitiated on Date of Judgment 21-06-2018, ITA No.695/2017 The Pr. Commissioner of Income Tax CIT (A) & another Vs. Smt.Deepika the ground that the notice issued was not inaccordance with law. (ut) That the subject matter of the penaltyproceedings was the order of the appellateauthority and not the order passed by theAssessing Officer. Hence, the order of penalty bythe Assessing Officer was not valid. (w) That when two fact finding authorities weresatisfied that the explanation offered by theassessee was not false and it was a bona fidethough the assessee had failed to conclusivelyprove the explanation the levy ofpenalty was notjustified.” (u) That the Tribunal was justified in holding thatthe entire penalty proceedings were vitiated on Date of Judgment 21-06-2018, ITA No.695/2017 The Pr. Commissioner of Income Tax CIT (A) & another Vs. Smt.Deepika the ground that the notice issued was not inaccordance with law. (ut) That the subject matter of the penaltyproceedings was the order of the appellateauthority and not the order passed by theAssessing Officer. Hence, the order of penalty bythe Assessing Officer was not valid. (w) That when two fact finding authorities weresatisfied that the explanation offered by theassessee was not false and it was a bona fidethough the assessee had failed to conclusivelyprove the explanation the levy ofpenalty was notjustified.” 3.In view of the aforesaid, the Tribunal foundthat there was no concealment on the part of theAssessee, attracting penalty under Section 271]{1||c| ofthe Act. Such cogent and reasonable findings of factsby the learned Tribunal and consequentially set asidethe penalty under Section 271{1||c| of the Act does notsive rise to any substantial question of law requiringconsideration by this Court under Section 260-A of theAct. Vs. Smt.Deepika 5/5 4The Appeal filed by the Revenue is thus. found to be without merit and liable to be dismissed| and the same is accordingly dismissed. No costs. Copy of this Order shall be sent to the Respondent-ASssessee. AN /- Sd/-.JUDGE. Sd/-.JUDGE.