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Income Tax Appellate Tribunal, JAIPUR BENCHES ‘A’ JAIPUR
Before: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM vk;dj vihy la-@ITA No. 218/JP/2020
आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES ‘A’ JAIPUR Jh fot; iky jko] U;kf;d lnL; ,oa Jh foØe flag ;kno] ys[kk lnL; ds le{k BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM vk;dj vihy la-@ITA No. 218/JP/2020 fu/kZkj.k o"kZ@Assessment Year :2010-11 cuke Sh. Ramandeep Singh Sandhu, ITO, Vs. 63, Jagdish Nagar, Centuary Ward 4(4), Homes, Mansarovar, Jaipur Jaipur LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AXPES8014M vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri Vikash Jain (CA) jktLo dh vksj ls@ Revenue by : Shri K. C. Gupta (JCIT) lquokbZ dh rkjh[k@ Date of Hearing : 21/07/2020 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 22/07/2020 vkns'k@ ORDER PER: VIKRAM SINGH YADAV, A.M.
This is an appeal filed by the assessee against the order of ld. CIT(A)-2, Jaipur dated 26.08.2019 confirming the levy of penalty u/s 271(1)(b) for A.Y. 2010-11.
At the outset, the ld. AR submitted that there is a delay in filing the present appeal and an affidavit of the assessee along with an application requesting for condonation of delay has been placed on record. It was submitted by the ld AR that the assessee had left India way back in year 2010 and is currently resident of Germany. It was submitted that when he had come to India subsequently in the month
2 Ramandeep Singh Sandhu, Jaipur Vs. ITO Ward 4(4), Jaipur of February, 2020, he came to know that the order has been passed by the ld. CIT(A) confirming the levy of penalty u/s 271(1)(b) of the Act. It was accordingly submitted that since the assessee was not present in India, he could not take the necessary steps in terms of filing the present appeal in time. However, there was no mala fide on the part of the assessee and as soon as he came to know about the impugned order, he reached out to his tax consultant and filed the present appeal. It was accordingly requested that the delay so happened in filing the present appeal may be condoned and the appeal may be admitted for adjudication on merits.
Per contra, the ld. DR opposed the delay in filing the present appeal.
After hearing both the parties and going through the affidavit placed on record, we find that the assessee has shown a reasonable cause for the delay in filing in the present appeal as he was not present in India and subsequently, as soon as he became aware of the impugned order, he was diligent enough and took necessary steps in reaching out to his Counsel and has filed the present appeal. In the result, the delay is hereby condoned and appeal is admitted for adjudication.
On merits, we find that the show cause for levy of penalty u/s 271(1)(b) of the Act was issued by the Assessing Officer on 25.06.2018 fixing the date for hearing on 10.07.2018 and on the same date, the penalty order u/s 271(1)(b) of the Act has been passed without providing any opportunity to the assessee. Further, it is noted that the 3 Ramandeep Singh Sandhu, Jaipur Vs. ITO Ward 4(4), Jaipur penalty proceedings u/s 271(1)(b) of the Act were initiated during the course of assessment proceedings for failure on the part of the assessee to comply with notice u/s 142(1) dated 19.07.2017, the ld. CIT(A) has however confirmed the levy of penalty stating that the notice dated 12.06.2017 was not complied with.
Further, the ld. AR submitted that the assessee left India way back in year 2010 hence, the notices send by the Department were not served and delivered to the assessee as nobody was residing at the given address. The assessee came to know about the assessment order when the assessee’s Father-in-law visited his house and he found the copy of the assessment order pasted on the wall of the house. It was accordingly submitted that since the assessee was not present in India and therefore, was not having any knowledge about the notices and the passing of the assessment order, there was a reasonable cause for non- compliance to the said notices. Further, our reference was drawn to the findings of the ld. CIT(A) in the quantum proceedings wherein she has acknowledged the fact that the assessee could not reply to the notices since he was out of India and the relevant findings of the ld CIT(A) reads as under:-
“2.5 I have perused the facts of the case, the assessment order, the submissions of the appellant and remand report alongwith rejoinder. It is seen that the Assessing Officer made addition of Rs. 2,13,400/- under section 69C as credit card expenses as unexplained made out of undisclosed sources. Authorized Representative contended that when notices were sent during re- assessment proceedings, assessee was out of India, so 4 Ramandeep Singh Sandhu, Jaipur Vs. ITO Ward 4(4), Jaipur compliance was not made. The immediate source was out of salary income according to him for which return of income was duly filed under section 139(1). In remand report, Assessing Officer, after verification found the payment in order by observing as under:- “The AR of the assessee submitted the proof of the payment made by the assessee through credit cards from his salary’s bank account and saving bank account. I have examined the issue of the case and found in order.”
It was further submitted that even assessment order was passed under section 144 r/w 147 of the Act, however, subsequently, the ld CIT(A) has taken cognizance of the fact that since the assessee was not present in India, the additional evidence were allowed to be taken on record and after seeking remand report from the AO wherein the AO found the explanation of the assessee as acceptable, the addition made were deleted. It was accordingly submitted that where the assessee’s explanation has been finally accepted by the Assessing officer and the ld CIT(A), there is no prejudice which is caused to the Revenue by non- compliance to the notices and in such circumstances, the penalty so levied may be directed to be deleted.
The ld DR is heard who has submitted that there is no infirmity in the order of the lower authorities where the penalty has been levied due to non-compliance to the notice issued u/s 142(1) of the Act. He accordingly supported the order of the lower authorities.
5 Ramandeep Singh Sandhu, Jaipur Vs. ITO Ward 4(4), Jaipur 9. After hearing both the parties and going through the material available on record, we find that where the assessee had already left the country way back in year 2010 and when the notice was issued in July 2017, there was no one available to receive the notice at the last known address, the very service of the notice issued u/s 142(1) is in doubt. The ld CIT(A) has also recorded a similar finding and the Assessing officer in his remand report dated 14.06.2019 has also taken note of the fact that the assessee was out of India since 2010 as evidenced by the assessee’s passport. Therefore, in such peculiar facts and circumstances where the assessee was out of the country and he had no knowledge of the subject notice and there is nothing on record that the notice was duly served on the assessee, we find that the assessee’s explanation that he could not have complied with the notice is found to be reasonable and the penalty so levied u/s 271(1)(b) of the Act is hereby directed to be deleted.
In the result, appeal of the assessee is allowed.
Order pronounced in the open Court on 22/07/2020.
Sd/- Sd/- ¼fot; iky jko½ ¼foØe flag ;kno½ (Vijay Pal Rao) (Vikram Singh Yadav) U;kf;d lnL;@Judicial Member ys[kk lnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 22/07/2020 *Ganesh Kr. आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू 1. vihykFkhZ@The Appellant- Ramandeep Singh Sandhu, Jaipur 2. izR;FkhZ@ The Respondent- ITO, Ward 4(4), Jaipur 3. vk;dj vk;qDr@ CIT