M/S. PLAZA CABLE INDUSTRIES LTD.,DELHI vs. DCIT, NEW DELHI

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ITA 1487/DEL/2014Status: DisposedITAT Delhi09 May 2022AY 2004-052 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 mitigating circumstances existed, such as the assessee nursing significant losses and lack of knowledge regarding the notices. Therefore, the assessee should be exonerated from the penalty.

What were the facts?

The assessee challenged a penalty of Rs. 10,000 imposed under Section 271(1)(b) for non-compliance with notices. The assessee claimed not to have received the notices and lacked knowledge of their issuance, especially given substantial losses.

What were the issues?

Whether the penalty under Section 271(1)(b) for non-compliance with notices is justified when the assessee claims non-receipt and lack of knowledge, especially in the context of substantial losses.

Which sections of the Income-tax Act were involved?

Section 271(1)(b)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “F” DELHI

Before: SHRI PRADIP KUMAR KEDIA & SHRI NARENDER KUMAR CHOUDHRY

For Appellant: Shri Rajeev Saxena, Adv, Ms. Sumangla Saxena, Adv
For Respondent: Ms. Kajal Singh, Sr.D.R

PER PRADIP KUMAR KEDIA, A.M.: The captioned appeal has been filed by the assessee against the order of the ld. CIT(A)-XVII, Delhi dated 26.12.2013 arising from the order passed by the Assessing Officer u/s. 271(1)(b) of the Income Tax Act dated 04.11.2011 concerning Assessment Year 2004-05.

2.

As per the grounds of appeal, the assessee has challenged the imposition of penalty of Rs.10,000/- imposed by the Assessing Officer u/s. 271(1)(b) of the Act.

1.

3. When the matter was called for hearing, the ld. counsel for the assessee pointed out that various notices listed in the penalty order under Section 271(1)(b) was not received by the assessee at all. The non compliance has caused due to lack of knowledge of the assessee on the issuance of notice. It was further pointed out that the assessee has filed the return of loss at Rs.(-)7,04,14,520/- which was reduced by Rs.19,37,322/- in the best judgment assessment owning to non attendance by the assessee. The loss was ultimately assessed at Rs.6,84,77,198/-. In this background, no mala fide can be inferred on the part of the assessee where the assessee is nursing such huge losses at its disposal.

4. In the light of the factual aspects pointed out on behalf of the assessee, we find that mitigating circumstances exists to exonerate the assessee from the clutches of penalty under Section 271(1)(b) of the Act.

5.

In the result, the appeal of the assessee is allowed.

Order pronounced in the open Court on 09 May, 2022.

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