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Income Tax Appellate Tribunal, CHANDIGARH BENCH “B”, CHANDIGARH
Before: SHRI. N.K.SAINI, VP & SHRI RAVISH SOOD, JM
PER RAVISH SOOD, JUDICIAL MEMBER:
The present appeal filed by the Assessee is directed against the order passed by the CIT(A)-1, Chandigarh, dated 26/06/2019, which in turn arises from the penalty imposed by the A.O under Sec. 271(1)(b) of the Income Tax Act, 1961 (for short ‘Act’), dated. 11/06/2018 for A.Y. 2010-11. The Assessee has assailed the impugned order on the following grounds of appeal before us:
1. That on law, facts and circumstances of the case the Worthy CIT(A) in Appeal No. 10191/18-19 dated 28.06.2019 has erred in passing that order in contravention of the provisions of Section 250(6) of the Income Tax Act, 1961.
2. That on law, facts and circumstances of the case, the Worthy CIT(A) has erred in dismissing the appeal in limine by holding that the appeal filed by the appellant, against penalty imposed u/s 271(l)(b) of Rs. 10,000/-, is beyond prescribed limitation period and there did not exist
reasonable cause for delay even when the appeal had been filed in time and there was no question of any delay therein. 3. That on law, facts and circumstances of the case, the Worthy CIT(A) was not justified in confirming the action of the Ld. AO in levying penalty u/s 271(l)(b) of Rs. 10,000/- on account of alleged failure to comply with the notice u/s 142(1) of the Act even when the appellant had not been served with the relevant notice.
That on law, facts and circumstances of the case, the Worthy CIT(A) was not justified in confirming the action of the Ld. AO for imposing penalty of Rs. 10,000/- u/s 271(l)(b) without considering the provisions of s. 273B of the Act and on consideration of provisions of s. 273B, the impugned penalty was not imposable on the appellant.
That the appellant craves leave for any addition, deletion or amendment in the grounds of appeal on or before the disposal of the same.
2. Briefly stated, assessment in the case of the captioned assessee was framed under section 144 r.w.s 147 of the Act, at an income of Rs. 67,73,630/-. As the assessee in the course of assessment proceedings had neither put up an appearance before the A.O nor filed any reply in pursuance to the queries raised by him, therefore, penalty proceedings under section 271(1)(b) were initiated by the A.O. while culminating the assessment vide his order passed under section 144 r.w.s 147 of the Act. Subsequently, the A.O. vide his order dt. 11/06/2018 imposed penalty under section 271(1)(b) of Rs. 10,000/- in the hands of the assessee.
3. Aggrieved, the assessee assailed the penalty levied by the A.O. under section 271(1)(b) before the Ld. CIT(A). In the course of hearing of the appeal it was observed by the Ld. CIT(A) that the appeal filed by the assessee involved a delay of 95 days. On being confronted with the aforesaid factum of delay in filing of the appeal, it was submitted by the assessee that the same had been filed within the statutory period after the service of the impugned order. Be that as it may, the assessee thereafter filed an application seeking condonation of delay in filing of the appeal. As is discernible from the records, it was the claim of the assessee that as the impugned order passed by the A.O. under section 271(1)(b) was never served upon her and was infact served through affixture at a wrong address which happened to be a government accommodation that was allotted to her husband and had been vacated way back about 10 years ago, therefore, she was never put to notice about the impugned proceedings or the consequential penalty order therein passed by the A.O. However, the CIT(A) after deliberating on the explanation tendered by the assessee was not persuaded to subscribe to the same. Observing, that the assessee had failed to come forth with any reasonable cause explaining the delay in filing of the appeal the CIT(A) declined to condone the delay therein involved in exercise of the powers vested with him under sub-section (3) of Section 249 of the Act and dismissed the appeal.
4. The Assessee being aggrieved with the order of the CIT(A) has carried the matter in appeal before us.
5. The Ld. Authorised Representative (in short ‘A.R’) for the assessee at the very outset of the hearing of the appeal submitted that the CIT(A) without appreciating the facts in the right perspective had most arbitrarily dismissed the appeal on account of the impugned delay involved in filing of the same. It was submitted by the Ld. AR that as the impugned order was served by the Department at a wrong address which happened to be a government accommodation allotted to the assessee’s husband that had been vacated about 10 years back on his retirement, therefore, the assessee had remained unaware both as regard to impugned proceedings and the penalty order therein passed by the A.O. It was further submitted by the Ld. AR that the assessee learnt about the order passed by the A.O. under section 271(1)(b) only after her bank account was attached by the Department. As such, it was averred by the A.R that the moment the assessee learnt about the impugned penalty imposed by the A.O under section 271(1)(b), she involving no further loss of time filed an appeal before the CIT(A). In the backdrop of his aforesaid contentions it was submitted by the Ld. AR that the CIT(A) had erred in dismissing the appeal without considering the factual position in the right perspective.
Per contra, the ld. Departmental Representative (for short ‘D.R’) relied on the orders of the lower authorities.
We have heard the authorized representatives of both the parties, perused the orders of the lower authorities and the material available on record. As is discernible from record, the appeal filed by the assessee in the backdrop of the date on which the impugned order is stated to have been served on the her i.e 13/06/2018 involved a delay of 95 days. It is the claim of the assessee that as the impugned order passed under section 271(1)(b) was got served at wrong address i.e at the old government accommodation that was allotted to the assessee’s husband and was vacated about 10 years back on his retirement, therefore, she had remained unaware about impugned proceedings and the consequential penalty imposed by the A.O. under the aforesaid statutory provision. The aforesaid factual position had neither been rebutted by the lower authorities nor any material had been placed before us by the Ld. D.R to controvert the same. Although, we are not oblivious of the fact that an assessee is obligated to intimate his/her change of address to the department, but then, in the case before us the assessee was earlier not being assessed to tax and the impugned proceedings were initiated under section 147 of the Act in her hands. In the totality of the factual position, we are of a strong conviction that there is substantial force in the claim of the assessee that as the impugned order was served through affixture at a wrong address therefore, she was at no stage aware about the same. Infact, we are of the considered view that the assessee would not had gained by delaying the filing of the present appeal. Apart from that, no intentional delay in filing of the appeal by the assessee before the Ld. CIT(A) emerges from the record. On the basis of the aforesaid factual matrix we are unable to concur with the dismissal of the appeal by the CIT(A) who we find had declined to condone the delay therein involved by exercising the discretion vested with him under sub-section (3) of Sec. 249 of the Act. Accordingly, we restore the matter to the file of the CIT(A) with a direction to hear the appeal afresh after affording a reasonable opportunity of being heard to the assessee.
Resultantly, the appeal filed by the assessee is allowed for statistical purposes in terms of our aforesaid observations.
Order pronounced in the open Court on 04/12/2020 .