VIJAYA SINGH,PATNA vs. ITO WARD- 6 (1), PATNA

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ITA 157/PAT/2023Status: DisposedITAT Patna13 March 2024AY 2018-193 pages
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What did the Tribunal hold?

The Tribunal held that since the assessment was completed under Section 143(3) and the non-compliance was not wilful, the assessee deserved immunity under Section 273B. Therefore, the penalty was deleted.

What were the facts?

The assessee failed to appear on a few occasions during assessment proceedings, leading to a penalty under Section 272A(1)(d). However, the assessment was ultimately completed under Section 143(3), not ex-parte.

What were the issues?

Whether penalty under Section 272A(1)(d) is leviable when assessment is completed under Section 143(3) despite initial non-compliance, and if there was reasonable cause for non-compliance.

Which sections of the Income-tax Act were involved?

Section 272A(1)(d),Section 143(3),Section 273B

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Income Tax Appellate Tribunal, “PATNA” BENCH, PATNA

Before: SHRI SONJOY SARMA, HON’BLE

For Appellant: Shri K.N. Prasad, Advocate
Hearing: 07/03/2024Pronounced: 13/03/2024

O R D E R PER, DR. MANISH BORAD, ACCOUNTANT MEMBER: The present appeal is directed at the instance of the assessee against the order of the National Faceless Appeal Centre (hereinafter the “ld. CIT(A)”) dt. 30/03/2023, passed u/s 250 of the Income Tax Act, 1961 (“the Act”) for the Assessment Year 2018-19.

2.

The sole issue for our consideration is regarding the levy of penalty u/s 272A(1)(d) of the Act at Rs.40,000/-. At the outset, the ld. Counsel for the assessee stated that, admittedly the assessee failed to appear on a few occasions during the assessment proceedings but finally necessary compliance was made and assessment was framed u/s 143(3) of the Act. Placing reliance on various decisions including that of the Co-ordinate Bench of the Assessment Year: 2018-19 Vijaya Singh 2 ITAT in the case of Akhil Bhartiya Prathmik Shikshak Sangh bhawan Trust vs. ADIT reported in [2008] 115 TTJ 419 (Del.), prayer was made for deletion of the impugned penalty. The ld. D/R on the other hand vehemently argued relying on the orders of the lower authorities.

3.

We have heard rival contentions and perused the material placed on record. We observe that due to non-compliance to the notices of hearing in the course of assessment proceedings, the ld. Assessing Officer levied penalty @ Rs.10,000/- for each non- compliance in total, Rs.40,000/- u/s 272A(1)(d) of the Act. We find that the assessment order has finally been framed u/s 143(3) of the Act. Admittedly, it is not a case of ex-parte assessment. Though, the assessee failed to comply on four occasions but finally he placed necessary documents for the completion of assessment proceedings. It thus indicates that the default for non- appearance was not wilful. We find that under similar facts and circumstances, the Co-ordinate Bench in the case of Akhil Bhartiya Prathmik Shikshak Sangh bhawan Trust vs. ADIT (supra), has held as under:- “2.5 We also find that finally the order was passed under s. 143(3) and not under s. 144 of the Act. This means that subsequent compliance in the assessment proceedings was considered as good compliance and the defaults committed earlier were ignored by the AO. Therefore, in such circumstances, there could have been no reason to come to the conclusion that the default was willful.”

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