KULDEEP RAJENDRA SINGH,SURAT vs. ITO, WARD 1(2)(6), SURAT

IN THE INCOME TAX APPELLATE TRIBUNAL SURAT BENCH "SMC", SURAT Before: Shri T. R. Senthil Kumar, Judicial Member & Shri Ratnesh Nandan Sahay, Accountant Member

ITA No: 1487/SRT/2025 Assessment Year: 2017-18

Kuldeep Rajendra Singh, Vs I.T.O., 406, E10, Green City, Pal Ward-1(2)(6), Bhatha Road, Bhatha, Surat, Surat. Bhatha S.O., Bhatha, Surat-394510. PAN: BCCPS 6435 A (Appellant) (Respondent)

Assessee Represented by : Shri Mehul Shah, C.A. Revenue Represented by : Ms. Neerja Sharma, Sr.DR Date of hearing : 05/05/2026 Date of pronouncement : 21/07/2026 आदेश/ORDER PER: RATNESH NANDAN SAHAY, AM: 1. This is an appeal filed by the assessee against the order of the National Faceless Appeal Centre (NFAC), Delhi [In short, ‘the ld. CIT(A)’] dated 27/10/2025 for the assessment year (AY) 2017-18 wherein the assessee has raised following grounds of appeal: "1. On the facts and circumstances of the case as well as law on the subject, the learned CIT(A) has erred in confirming the action of Assessing Officer in levying penalty of ₹ 30,000/- u/s 272A(1)(d) of the Act. 2. It is therefore prayed that the above penalty levied by the Assessing Officer and confirmed by the learned CIT(A) may please be deleted. 3. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal."

2 ITA No. 1487/Srt/2025 Kuldeep Rajendra Singh Vs ITO 2. Facts of the case in brief, are that the case of the assessee was selected for scrutiny assessment under CASS and accordingly, notice under Section 143(2) and 142(1) of the Income Tax Act, 1961 (in short, the Act) were issued to the assessee alongwith detailed questionnaire. However, the assessee did not comply with any notice and therefore, the Assessing Officer was forced to pass order under Section 144 of the Act and accordingly penalty proceedings under Section 272A(d) of the Act was initiated. The Assessing Officer also passed order under Section 272A(1)(d) of the Act dated 26/08/2021 for the A.Y. 2017-18 and a penalty of ₹ 30,000/- (₹ 10,000 for each default for each non-compliance) was imposed. 3. Aggrieved by the penalty order, the appellant filed appeal before the ld. CIT(A), who vide the impugned order, dismissed the appeal of the assessee and confirmed the penalty imposed by the Assessing Officer under Section 272A(1)(d) of the Act on the ground that the assessee has failed to demonstrate any sufficient cause for such failure. 4. Further aggrieved by the order of the ld. CIT(A), the assessee is in appeal before this Tribunal. 5. During the appellant proceedings before us, the assessee in the statement of facts filed before this Tribunal, has stated as under:

3 ITA No. 1487/Srt/2025 Kuldeep Rajendra Singh Vs ITO "1. The appellant is a proprietor of M/s Karsan Enterprise, which is engaged in distribution of petrol / diesel through petrol pump. He operates this petrol pump which is owned & allotted to him by Shell India Markets Pvt. Ltd. (Shell). 2. You appellant had duly filed this return of income on 10/10/2017 declaring total income of Rs. 674980/-. 3. His case was taken up for scrutiny u/s 143(2) of ITA, 1961 but unfortunately these notices were not received by him & the A.O. estimated his net profits at Rs. 6182132 being one percent of his turnover & passed a best judgement assessment us 144 rejecting his audited books of account." The ld. Counsel of the assessee also submitted that since the notices were not received by the assessee, the penalty imposed by the Assessing Officer under Section 272A(1)(d) of the Act is not justifiable and therefore be deleted. It was also submitted by the assessee that in response to the show cause notice issued by the Assessing Officer for imposition of penalty under Section 272A(1)(d) of the Act, the assessee vide its letter dated 08/03/2021 has already informed the Assessing Officer as under: "1. Your SCN proposing penalty u/s 272A(1)(d) of the ITA, 1961 was issued on 21/12/2019 for not replying to your notice u/s 142(1) r.w. 143(2) of the ITA, 1961 pertaining to complete scrutiny assessment selected under CASS for AY 2017-18. 2. Your said assessment order was passed ex-parte u/s 144 of the ITA, 1961 vide your order dated 20/12/2019. 3. Your good office may note that we had made submissions for initiation of scrutiny assessment vide our submission date

4 ITA No. 1487/Srt/2025 Kuldeep Rajendra Singh Vs ITO 05/09/2019 which your good office seems have failed to appreciate and thereby passing and ex-party order on 20/12/2019. 4. Further, your good office may appreciate the fact that the online faceless assessment scheme was totally new us, and I not being very tech savvy was dependent on my consultants. We had been used to receive physical notices for intimation and it took us time for us to adapt to this new system. We are a law abiding citizens of this country and have been paying all taxes from time to time. We have further never resorted in any tax evasion activities. 5. Due to your best judgement order, we have already been put to mental agony and now required to go through the appellant proceedings. 6. Further, in response to your previous SCN dated 21/12/2019, we had already filed our reply dated 06/01/2020 requesting your good office for keep the said proceedings in abeyance and eventually doing away with the same, since the said non- compliance was not intentional but only a failure to adapt to the said new system introduced by your good department. 7. Hence, based on above facts of the case, we humbly hereby submit before your good office to kindly drop the said penalty proceedings so as not to cause any undue hardship or further mental agony. The assessee also submitted that the response was not considered by the Assessing Officer and penalty was imposed. 6. The ld. Sr.DR supported the orders of the lower authorities. The ld. Sr.DR submitted that it was the duty of the assessee to comply with all statutory notices issued by the department once the return was filed and to pursue his case by making necessary compliance.

5 ITA No. 1487/Srt/2025 Kuldeep Rajendra Singh Vs ITO 7. We have carefully considered the rival submissions and it is found that the penalty was imposed without hearing the assessee. Thus, we restore the matter back to the file of the Assessing Officer to provide adequate opportunity of being heard to the assessee and decide the issue accordingly. 8. In the result, this appeal of the assessee allowed for statistical purposes. Order is pronounced under the provisions of Rule 34 of IT(AT) Rules, 1963 on 21/07/2026.

Sd/- Sd/- (T. R. SENTHIL KUMAR) (RATNESH NANDAN SAHAY) JUDICIAL MEMBER ACCOUNTANT MEMBER Surat Dated 21/07/2026 *Ranjan आदेश�ȧĤǓ�ͧ �ͪ �\ Ē ȯͪ��/ Copy of Order Forwarded to:- 1. Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT 6. Guard file. By order/आदेशसे,

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