SANJAY GOYAL,JAIPUR vs. CIRCLE (INTL TAX), JAIPUR

IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, “SMC” BENCH, JAIPUR BEFORE SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER & SHRI KULDIP SINGH, JUDICIAL MEMBER ITA Nos. 756-759/JPR/2026 (Assessment Years:2013-14 to 2015-16 and 2019-20) Sanjay Goyal Vs. Circle (Intl Tax) 4th Floor Jeevan Nidhi-2, E-181A Ramesh Marg C Scheme Jaipur Ambedkar Circle, Bhawani Singh Road Jaipur �थायीलेखासं./जीआइआरसं./PAN/GIR No:ACFPG 0918E Appellant .. Respondent Appellant by : Sh. Vinod Kumar Gupta, CA Respondent by : Mrs. Aarti Rawat, Addl. CIT Date of Hearing 10.08.2026 Date of Pronouncement 17.08.2026

O R D E R Per Annapurna Gupta, AM:- All the four appeals relate to the same assessee and have been filed against separate orders passed by the Office of the Commissioner of Income Tax Appeal CIT(A), Delhi 42 (hereinafter referred to as “Ld. CIT(A)”) all dated 27.02.2026 confirming the levy of penalty u/s

P a g e | 2 ITA No.756 to 759/JPR/2026 Sanjay Goyal 271(1)(b) of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for different Assessment Years i.e. AY 2015-16, 2013-14, 2014- 15 and 2019-20 respectively. 2. The assessee has agitated the confirmation of levy of penalty u/s 271(1)(b) of the Act by Ld. CIT(A) before us. A chart detailing the non-compliance of notices for each year was filed before us which was reproduced hereunder:-

P a g e | 3 ITA No.756 to 759/JPR/2026 Sanjay Goyal ITA No. Assessment Year Quantum of Penalty Levied 756/JPR/2026 2015-16 Rs.20,000/- 757/JPR/2026 2013-14 Rs.20,000/- 758/JPR/2026 2014-15 Rs.10,000/- 759/JPR/2026 2019-20 Rs.20,000/-

P a g e | 4 ITA No.756 to 759/JPR/2026 Sanjay Goyal Hence, the penalty so levied/confirmed is against the provision of section 273B of the Act. Hence, the penalty is liable to be deleted in full. 4. That the appellant craves your indulgence to add, amend or alter all or any grounds of appeal before or at the time of hearing. 7. The argument of the ld. Counsel for the assessee before us was that, the penalty levied by the AO and confirmed by the Ld. CIT(A) was unjustified for the reason that:- i) There was reasonable cause with the assessee for not complying with the notices, being that he was an NRI and the address for communication given by the Department was that of his sister-in-law whose child was suffering from a serious ailment and therefore she did not inform the assessee of the notices received by her. As evidence the medical records of the child of the assessee’s sister-in-law was filed before us. His submissions in writing in this regard are as under:- 5. In this regard, it is submitted that the email id: Vinayakgems2000@yahoo.com, to which the notices under consideration were sent, belongs to the company of the appellant's sister-in-law (bhabhi). Since the appellant was a non-resident residing outside India, the said email ID was mentioned in the appellant's profile on the Income-tax e-filing portal. Hence, the appellant did not have access to the said email account and, therefore, was not in a position to monitor the communications received therein. 6. Further, there were exceptional circumstances which prevented the appellant's sister-in-law from promptly communicating the aforesaid notices to the appellant. During the relevant period, her son (aged 28 years) was admitted to the hospital in the USA on account of a serious kidney ailment and was undergoing treatment in connection with a kidney transplant since June 2024 (Copies of medical records are enclosed). Owing to the said medical emergency, her attention was necessarily occupied with the treatment and care of her son, and she could not immediately communicate the aforesaid notices to the appellant.

P a g e | 5 ITA No.756 to 759/JPR/2026 Sanjay Goyal 8. That in any case, the non-compliances of the notice did not cause any prejudice to the Department as the assessee had sufficiently complied with the remaining notices furnished all explanations to the AO and the assessment had been completed after due inquiry conducted by the AO and considering the explanation furnished by the assessee to the same. That it was not a case of ex parte assessment, in the absence of any explanation furnished by the assessee. 9. Ld. DR however pointed out that Ld. CIT(A) had negated the contention of the assessee with facts, that there was good and sufficient compliance on the part of the assessee during assessment proceedings warranting no penalty u/s 271(1)(b) of the Act. Our attention was drawn in this regard to para 5.4 to 5.6 of Ld. CIT(A)s order as under:- ………… 5.4 In order to adjudicate the issue, the assessment proceedings case notings and assessment records, as accessible on the ITBA (Income Tax Business Application) portal of the department, have been gone through. On perusal thereof, it is noted that the assessee did not file his return of income in response to the notice issued u/s 148 dated 31.03.2024 within the time specified in the said notice. It is noted that the return inresponse to notice u/s 148 was filed by the assessee beyond the stipulated time on 04.06.2024. The AO issued first notice u/s 142(1) on 18.09.2024 along with a detailed questionnaire annexed thereto calling for various specified details/documents. The compliance was sought by 27.09.2024. However, no reply, at all, was filed by the assessee to the said notice nor any request for adjournment or grant of more time was made. This led the AO to issue another reminder notice u/s 142(1) on 17.10.2024 whereby the assessee was again requested to furnish the information called for vide the earlier notice dated 18.09.2024. The compliance was sought by 25.10.2024. However, the assessee again did not furnish any reply/details in response to the second notice too nor any request for adjournment or grant of more time was made. This led the AO to issue another reminder notice u/s 142(1) on 06.12.2024 whereby the assessee was again requested to furnish the information called for vide the earlier notices dated 18.09.2024 & 17.10.2024. However, the assessee again did not furnish any

P a g e | 6 ITA No.756 to 759/JPR/2026 Sanjay Goyal reply/details in response to the third notice too. This led to the AO issuing a show cause notice on 05.02.2025 stating therein that due to non-submission of any reply by the assessee, the transactions aggregating to Rs. 75,00,000, as reflected in material seized during the course of search & seizure action conducted on 03.08.2022 in the case of M/s Vinayak Gems Pvt Ltd. and as mentioned in the notices issued earlier, remained unexplained and the assessee was asked to show cause why the same not be added to the income of the assessee. It was only after this show cause notice dated 05.02.2025, which was preceded by three responded notices u/s 142(1) on 18.09.2024,17.10.2024 and 06.12.2024, that the assessee finally responded on 08.02.2025. It is further noted that the assesseevide submissions dated 08.02.2025 also only partly submitted the details/documents called for by the AO vide notice dated 18.09.2024, 17.10.2024 and 06.12.2024. It is pertinent to mention here that, on perusal of the ITBA assessment proceedings case notings, no reply dated 16.01.2025 is found submitted by the assessee in this case unlike as stated by the assessee in his written submissions reproduced at para 4 above, though such reply is found in fact submitted during assessment proceedings u/s 147 for AY 2013-14 & 2014-15.

5.5. From the above sequence of events during the assessment proceedings, it is noted that no reply, whatsoever, was submitted by the assessee to the notices u/s 142(1) dated 18.09.2024 and 17.10.2024 nor any request for adjournment or grant of more time was made The reply filed on 08. 02.2025 was filed only after issue of the three notices u/s 142(1) dated 18.09.2024, 17.10.2024 and 06.12.2024 and a show cause notice dated 05.02.2025, that too much after expiry of the stipulated date given by the AO. It is further noted that even vide the said reply dated 08.02.2025, the assessee did not furnish all of the requisite details/documents called for by the AO vide the notices u/s 142(1) and the subsequent show cause notice dated 05.02.2205. It only furnished some basic details and did not answer the query raised by the AO regarding transactions worthRs. 75,00,000 as reflected in the seized material. Thus, it is noted that the assessee was deliberately deploying dilatory tactics to delay and thwart meaningful conduct of the assessment proceedings initiated pursuant to information gathered during the course of search & seizure action in the assessee's group concerns' case. Due to non-submission by the assessee of any explanation/ relevant documents to explain the said transactions, the AO ultimately held the same as unexplained and added the same to the returned income vide the assessment order dated 23.05.2025.

5.6 In the light of above discussed facts & circumstances, the assessee's contention that as the notices were ultimately responded to and the requisite

P a g e | 7 ITA No.756 to 759/JPR/2026 Sanjay Goyal details were submitted, though with delay, and that the assessment was ultimately completed based on the documents furnished by the assessee, the same should be treated as good compliance on part of the assessee warranting no penalty u/s 271(1)(b), is not found tenable. The facts & circumstances of the case laws relied upon by the assessees in his written submissions reproduced at para 4 above are found not applicable to the instant case of the assessee due to the above discussed distinguishing facts. The assessment in this case did result in additions made by the AO due to non-submission of the requisite details/documents to explain the specified transactions. ………… 10. It was also pointed out that the Ld. CIT(A) had categorically noted the fact that all notices were served on the email address which was provided by the assessee and it could not be a case of non-service of notice at all and no reasonable cause accordingly was there for not complying with the said notices. 11. We have heard the contention of both the parties and have gone through the orders of the authorities below. We find that the assessee has adduced reasonable cause for non-compliance with the notices in which penalty was levied u/s 271(1)(b) of the Act. The assessee had submitted that the email address for communication of notices supplied to the Department belonged to the assessee’s sister-in-law, since the assessee himself was a non-resident residing outside India and the assessee’s sister-in-law was prevented from promptly communicating the aforesaid notices to the assessee. He had stated that the said notices to the assessee were served on the email address of his sister in lawduring the relevant period when her son was admitted to the Hospital in USA on account of a serious kidney ailment and was undergoing treatment in connection with a kidney transplant.Copies of

P a g e | 8 ITA No.756 to 759/JPR/2026 Sanjay Goyal medical reports have also been placed before us. The assessee pointed out that immediately on becoming aware of the notices, the assessee complied with the same without delay and participated in the assessment proceedings. The assessee’s explanation for delay is duly substantiated with evidences also and the Revenue has not controverted the fact that the email address was not of the assessee but his relative. Therefore we hold that the assessee having adduced reasonable cause for not complying with notices issued, there was no reason to penalise the assessee u/s 271(1)(b) of the Act. 12. The penalty accordingly levied in all the four years is directed to be deleted. 13. In effect, all the appeals of the assessee are accordingly allowed. Order pronounced in the Open Court on 17.08.2026.

Sd/- Sd/- (Kuldip Singh) (Annapurna Gupta) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated 17.08.2026 Mittali, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT By Order, Asst. Registrar ITAT, Jaipur