VAKHITHASAFANNA,CHENNAI vs. ITO, CHENNAI

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ITA 2288/CHNY/2026Status: DisposedITAT Chennai22 July 2026AY 2020-215 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal partially deleted the penalty, giving the benefit of doubt to the assessee for one notice due to system glitches. However, the penalty for non-response to the other notice was sustained as no evidence was provided to show non-receipt.

What were the facts?

The assessee failed to file her return of income for AY 2020-21. Subsequently, notices were issued during the assessment proceedings, to which the assessee claims she was unaware of some. A penalty was levied for non-response to certain notices.

What were the issues?

Whether the penalty under Section 272A(1)(d) is sustainable when the assessee claims unawareness of notices due to system issues, and whether the assessee deliberately failed to respond.

Which sections of the Income-tax Act were involved?

Section 272A(1)(d),Section 148,Section 144B,Section 148A(b),Section 142(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘C’ BENCH: CHENNAI

Before: SHRI ABY T. VARKEY & SHRI GAGAN GOYAL

For Respondent: Mr. Chilakamarthi Vijay Raju
Hearing: 18.06.2026Pronounced: 22.07.2026

आदेश / O R D E R PER ABY T. VARKEY, JM: This is appeal preferred by the assessee Vakhithasafanna against the order of the Learned Commissioner of Income Tax (Appeals)/NFAC, (hereinafter referred to as “the Ld.CIT(A)”), Delhi, dated 18.03.2026 for the Assessment Year (hereinafter referred to as "AY”) 2020-21 against

ITA Nos. 2288 /Chny/2026 (AY 2020-21) Vakhithasafanna :: 2 :: the penalty levied u/s.272A(1)(d) of the Income Tax Act, 1961 (hereinafter referred to as "the Act”).

2.

The main grievance of the assessee is against the action of the Ld.CIT(A) upholding the penalty of Rs.20,000/- levied by the AO u/s.272A(1)(d) of the Act.

3.

The brief facts are that the assessee is an individual who didn’t file her return of income (RoI) for AY 2020-21. However, the JAO re- opened the assessment by issuing notice u/s.148 of the Act dated 30.03.2024. Thereafter, it is noted that the assessment got migrated to Faceless Assessment and later the assessment was framed u/s.144B of the Act.

4.

Thereafter, the Faceless Assessing Officer [FAO] taking note that notices issued by him during the assessment proceedings didn’t evoke any response from the assessee, initiated penalty proceedings u/s.272A(1)(d) of the Act. According to assessee, she was in the dark about the notices dated 05.12.2024 and 13.12.2024. The Ld.AR brought to our notice that the assessee had replied to the notices issued by the AO u/s.148A(b) of the Act dated 08.02.2024 which has been acknowledged by the AO at Para 3.1.2 of the order and thereafter only the AO reopened the assessment. It was also pointed out that

ITA Nos. 2288 /Chny/2026 (AY 2020-21) Vakhithasafanna :: 3 :: pursuant to the notice u/s.148, assessee had filed the return of income of 30.03.2024 declaring total income of Rs.7,34,660/- and the statement of total income. According to the assessee, the AO has accepted that pursuant to the notice u/s.142(1) dated 25.06.2024 assessee had replied to the same on 28.06.2024, which fact the AO acknowledges in the table given at Page 2 of the assessment order. Hence, it cannot be said that assessee deliberately didn’t respond to the notice issued by the AO. However, the AO not satisfied with the reply of the assessee, alleged failure on her part to reply to notices u/s.142(1) of the Act dated 05.12.2024 & 13.12.2024, levied penalty of Rs.10,000/- for each fault viz., total Rs.20,000/-. On appeal, the Ld.CIT(A) has confirmed the penalty levied by the AO. The Ld.AR brought to our notice that the quantum assessment in this case has been remitted back to the file of Ld.CIT(A) for fresh adjudication by the ITAT by order dated 29.01.2026 and hence, pleaded before the Ld.CIT(A) that penalty u/s. 272A(1)(d) should not be sustained. However, the Ld.CIT(A) is noted to have repelled the same on the ground that omission to respond to notices u/s.142(1) constitutes a fault for independent levy of penalty u/s. 272A(1)(d) of the Act. Aggrieved the assessee is before us.

ITA Nos. 2288 /Chny/2026 (AY 2020-21) Vakhithasafanna :: 4 :: 5. Heard both sides. The AO is noted to have alleged failure on assessee’s part to reply to his notices u/s.142(1) of the Act dated 05.12.2024 & 13.12.2024, and levied penalty of Rs.10,000/- for each fault viz., total Rs.20,000/-. As noted, the AO has reopened the assessment for AY 2020-21 on 30.03.2024, not satisfied with the reply of assessee against the notices issued by the AO u/s.148A(b) of the Act dated 08.02.2024 which fact has been acknowledged by the AO at Para 3.1.2 of the assessment order. Further, the AO has accepted that pursuant to the notice u/s.142(1) dated 25.06.2024 assessee had replied to the same on 28.06.2024, which fact the AO acknowledges in the table given at Page 2 of the assessment order. In the light of the aforesaid facts it cannot be said that assessee deliberately didn’t respond to AO’s notices u/s.142/148, etc. The reason given by the assessee not to respond to the notices dated 05.12.2024 and 13.12.2024 was that the assessee wasn’t aware of the notices in question may be due to glitches in the system cannot be ruled out. However, assessee could show only that notice dated 05.12.2024 couldn’t be traced from her e-mail inbox. In such a scenario we are inclined to delete Rs.10,000/- giving benefit of doubt to the assessee qua notice dated 05.12.2024 and no evidence could be placed to show that assessee didn’t receive notice dated 13.12.2024, hence, we

ITA Nos. 2288 /Chny/2026 (AY 2020-21) Vakhithasafanna :: 5 :: sustain penalty of Rs.10,000/- for the lapse/omission to respond to the notice dated 13.12.2024.

6.

In the result, appeal filed by the assessee is partly allowed.

Order pronounced on the 22nd day of July 2026, in Chennai.

Sd/- Sd/- (गगन गोयल) (एबी टी. वक�) (GAGAN GOYAL) (ABY T. VARKEY) लेखा सद�/ACCOUNTANT MEMBER �या�यक सद�य/JUDICIAL MEMBER चे�नई/Chennai, �दनांक/Dated: 22nd July, 2026. YS आदेश क� ��त�ल�प अ�े�षत/Copy to: 1. अपीलाथ�/Appellant 2. ��थ�/Respondent 3. आयकरआयु�/CIT, Chennai / Madurai / Salem / Coimbatore. 4. िवभागीय�ितिनिध/DR 5. गाड�फाईल/GF

Digitally signed YASHVI by YASHVIR SINGH R SINGH Date: 2026.08.04 10:44:28 +05'30'

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