NARAYANAN CHANDRAPRAKASAM,THANJAVUR vs. INCOME TAX OFFICER, THANJAVUR

There is a delay of 18 days in filing the present appeal before the Tribunal. The assessee has filed a petition seeking condonation of delay, supported by an affidavit explaining the reasons for the belated filing of the appeal. The assessee stated that, he was under medical treatment from 10.06.2026 to 13.07.2026 and was unable to contact his tax consultant and obtain necessary advice during the said period. After recovery, he contacted his consultant and took steps to file the appeal, which caused the delay of 18 days. On perusal of the reasons stated, we are of the view that no latches can be attributed to the assessee as there is sufficient cause for belated filing of this appeal. Hence, we condone the delay and proceed to dispose off the appeal on merits.

Brief facts of the case are as follows:- The assessee is an individual. For AY 2017-18, return of income was filed on 25.07.2017 declaring total income of Rs.2,42,779/-. The assessment was completed u/s. 143(3) of the Act by making an addition of cash deposits at Rs.3,20,000/- during the demonetization period as unexplained money u/s. 69A of the Act. Penalty proceedings u/s. 271(1)(c) of the Act was initiated by issuing show cause notice on 15.12.2019. During the course of penalty

Aggrieved by imposing of penalty u/s. 270AAC of the Act, the assessee filed an appeal before the First Appellate Authority (FAA). The FAA confirmed the penalty imposed u/s. 270AAC of the Act and dismissed the appeal of the assessee. The relevant findings of the FAA read as follows: “4.6 The appellant has not brought any material on record to establish that the penalty order suffers from procedural defect, violation of natural justice, or incorrect computation. The penalty amount of Rs. 19,200/-, being 10% of tax payable u/s 115BBE on the said addition, has been correctly worked out by the AO. In view of the above facts and circumstances, I find no merit in the grounds raised by the appellant. The penalty levied by the AO u/s 271AAC(1) amounting to Rs.19,200/- is hereby confirmed.”

Aggrieved by the order of the FAA confirming the penalty imposed u/s. 270AAC of the Act, the assessee has filed present appeal before the Tribunal. The Ld.AR submits that as against quantum addition, the assessee had preferred an appeal before FAA which was dismissed. On further appeal the Tribunal vide order dated 20.05.2026 in ITA No. 645/Chny/2026, restored the matter to the files of the FAA. The Ld.AR

The Ld.DR was duly heard.

We have heard rival submissions and perused the materials on record. The penalty u/s. 271AAC(1) of the Act arises out of the addition of Rs.3,20,000/- made u/s.69A of the Act towards cash deposits during the demonetization period. We find that, against the said addition, the assessee had preferred an appeal before the Tribunal and, vide order dated 20.05.2026 in ITA No.645/Chny/2026, the matter was restored to the file of the FAA for adjudication afresh. The said proceedings are presently pending before the FAA. Since the very addition which forms the basis for levy of penalty u/s.271AAC(1) of the Act is presently pending adjudication before the FAA, we deem it appropriate to restore the impugned penalty order also to the file of the FAA. The FAA is directed to adjudicate the penalty proceedings after a decision is taken on the quantum appeal. It is ordered accordingly.