MANOJ SUDHAKAR PARDESHI,PUNE vs. DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE - 14, PUNE

ORDER

PER D. KARUNAKARA RAO, AM:

by the assessee are as under :- “1. The learned DCIT, Circle 14, Pune (hereinafter referred to as Learned AO) erred in law and on facts in levying a penalty of Rs. 10,000/- u/s 271(1)(b) of the ITA, 1961.

2. In arriving at the conclusion for levy of penalty, the lower authorities failed to appreciate that - the appellant ensured due compliances with all the notices issued by the Learned AO and hence levy of penalty is bad is law. - no non-compliance with notices issued by Learned AO deciphers from the assessment order.

143(3) was passed with NIL additions and it was stated that the appellant had produced and explained the details called from time to time. 3. The Learned CIT(A)-7 erred in law and on facts in not appreciating that the Learned AO failed to abide by provisions of Sec 129 of ITA 1961. 4. The appellant craves leave to add / modify / delete / amend all / any of the grounds of appeal

.”

3. Briefly stated the relevant facts include that the assessee is a proprietor of Reliable Techno Solutions. The assessee filed the return of income declaring total income of Rs.1,18,83,396/-. During the assessment proceedings, the Assessing Officer noted that the assessee did not comply to notice issued u/s 142(1) of the Act on 07.12.2015 requiring the assessee to furnish certain information on or before 21.12.2015. Further, the Assessing Officer initiated the penalty proceedings u/s 271(1)(b) of the Act and a show cause notice issued along with the notice u/s 142(1) of the Act dated 11.01.2016. Further, the Assessing Officer noted that there was no response to show cause notice issued and the Assessing Officer imposed the penalty of Rs.10,000/- u/s 271(1)(b) of the Act in the hands of the assessee. The CIT(A), without giving reasonable opportunity to the assessee, confirmed the penalty as imposed/levied by the Assessing Officer.

4. Aggrieved with the above decision of the CIT(A), the assessee is in appeal before the Tribunal with the above extracted grounds.

5. Before us, at the outset, ld. Counsel for the assessee brought our attention to the appellate order of the CIT(A) and mentioned that the same is an ex-parte order. Further, ld. Counsel for the assessee submitted that the assessee ensured due compliance with all the notices issued by the Assessing Officer. The ld. Counsel for the assessee submitted that the assessment order NIL additions. The ld. Counsel for the assessee further relied on the decision of Pune Bench of the Tribunal in the case of Mrs. Shakuntala Hiralal Malu vs. DCIT vide and others dated 29.04.2011 as well as the decision of Delhi Bench of the Tribunal in the case of Globus Infocom Limited vs. DCIT vide ITA No.738/Del/2014 dated 29.06.2016 and submitted that an identical issue came up before the Tribunal and the Tribunal in both the respective decisions set-aside the order of the CIT(A) and allowed the appeal in favour of the assessee.

7. Considering the above submissions, we find that undisputedly assessment has been framed u/s 143(3) read with sec. 153A/153C after considering the submissions of the assessee. There is no ex parte assessment. We thus do not find reason to disbelieve the above-stated explanation of the assessee for non- compliance of notice issued u/s 142(1)/143(2) on 23.10.2007 fixing the date of hearing on 2.11.2007. The explanation of the assessee in this regard remained that he had sent the notice to his CA, but he was extremely busy in filing he returns and, therefore, due compliance may not have been made. The chart of appearance made available at pages 37 & 38 of the Paper Book filed on behalf of the assessee before the Tribunal shows that Shri Mundada, the ld. CA of the assessee used to attend the office of the AO in connection with the cases of Malu- Agarwal group. Thus, no mala fide intention can be inferred against the assessee for deliberate non-compliance of notice issued on 23.10.2007 for 2.11.2007. The Delhi Bench of the Tribunal in the case of Akhil Bhartiya Prathamik Shikshan Sangh Bhavan Trust (supra) has held that if the assessment order is passed u/s 143(3) and not u/s 144, then non-compliance is deemed to have been waived. Similar view has been taken by the Ahmedabad Bench of the Tribunal in the case of Swarnaben M Khanna & Others (supra). The provisions laid down u/s 273B of the Act make it clear that no penalty u/s 271(1)(b) shall be imposed on the person or the assessee, as the case may be, for any failure referred to in the said provisions, if he proves that there was reasonable cause for the said failure. Invoking these provisions u/s 273B of the Act, we find that the assessee in the present case has been successful in explaining that there was reasonable cause for non-compliance of the notice in question on the part of the assessee, as discussed above. We thus set aside the orders of the authorities below in this regard and direct the AO to delete the penalty levied u/s 271(1)(b) for non- compliance of notice issued on 23.10.2007 for 2.11.2007. The ground is accordingly allowed. Consequently, the appeals are allowed.