DEVNADI AVISORY PVT. LTD.,HOWRAH vs. INCOME TAX OFFICER, WARD-13(1), KOLKATA, KOLKATA

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ITA 226/KOL/2023Status: DisposedITAT Kolkata11 May 2023AY 2013-144 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal found that the assessee had a reasonable cause for non-compliance with the first notice as it was not served. The assessee also complied with the second notice. Therefore, the penalty was deleted.

What were the facts?

The assessee is in appeal against a penalty imposed under section 271B for non-compliance with two notices issued by the Assessing Officer. The assessee claimed the first notice was not served and the second was complied with.

What were the issues?

Whether the penalty under section 271B for non-compliance with notices is justified when one notice was not served and the other was complied with.

Which sections of the Income-tax Act were involved?

Section 271B

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘A’ BENCH, KOLKATA

Before: Shri Rajpal Yadav, Vice- & Dr. Manish Borad

Per Shri Rajpal Yadav, Vice-President (KZ):- The assessee is in appeal before the Tribunal against the order of ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi

Devnadi Advisory Pvt. Limited dated 24th February, 2023 passed for assessment year 2013-14.

2.

The grounds of appeal taken by the assessee are argumentative in nature and not in consonance with Rule 8 of ITAT Rules.

1.

3. In brief, its grievance is that the ld. CIT(Appeals) has erred in confirming the penalty of Rs.20,000/- imposed by the ld. Assessing Officer under section 271B of the Income Tax Act.

4. With the assistance of ld. Representatives, we have gone through the record carefully. According to the ld. Assessing Officer, he has issued notices dated 14.03.2022 and 19.02.2022 to the assessee. These notices were not complied with by the assessee. Therefore, a penalty under section 271B has been imposed. In this section, it has been provided that if an assessee failed to comply with the notice issued by the ld. Assessing Officer, the penalty of Rs.10,000/- would be imposed on single failure. In the present case, the assessee has imposed a penalty of Rs.20,000/- on account of failure of the assessee for not comply with two notices.

Devnadi Advisory Pvt. Limited 5. Appeal to the ld. CIT(Appeals) did not bring any relief to the assessee.

6.

It has been brought to our notice that the first notice was not served upon the assessee and the second notice was complied with by the assessee. A plea to this effect has specifically been raised by the assessee before the ld. CIT(Appeals), but the ld. 1st Appellate Authority has dismissed the appeal for want of prosecution without taking cognizance of this fact. Considering the above facts and circumstances, we are of the view that the assessee has not knowingly violated the notices issued by the ld. Assessing Officer. There was a reasonable cause for its non-appearance on the first notice, as it was not served upon the assessee. Similarly, the assessee has submitted reply to the second notice, therefore, it cannot be construed that the assessee failed to comply with the notices. Accordingly, we allow the appeal of the assessee and delete the penalty.

7.

In the result, the appeal of the assessee is allowed. Order pronounced in the open Court on May 11th, 2023.

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