MANISHBHAI HIRALAL RAVESHIA,RAJKOT vs. ITO, WARD-2(1)(2), RAJKOT, RAJKOT

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ITA 851/RJT/2025Status: DisposedITAT Rajkot08 June 2026AY 2017-184 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal held that while the initial non-compliance with the first notice warranted a penalty, the subsequent notices were merely reminders. Therefore, penalty for the reminders was deleted.

What were the facts?

The assessee failed to respond to multiple notices issued by the Assessing Officer during assessment proceedings for AY 2017-18. Consequently, a penalty was levied under Section 272A(1)(d) for non-compliance.

What were the issues?

Whether penalty under Section 272A(1)(d) is leviable for failure to respond to reminder notices, and if the penalty for the initial non-compliance is justified.

Which sections of the Income-tax Act were involved?

Section 272A(1)(d),Section 142(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC”

Before: DR. ARJUN LAL SAINI

For Respondent: Shri Anadi Dixit, Ld. Sr-DR
Hearing: 11/03/2026Pronounced: 08/06/2026

आदेश/ORDER Per, Dr. Arjun Lal Saini, A.M. Captioned appeal filed by the assessee, pertaining to Assessment Year 2017-18, is directed against the order passed under section 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) by National Faceless Appeal Centre (NFAC), Delhi/Commissioner of Income-tax (Appeals), dated 24.09.2025, which in turn arises out of an assessment order passed by the Assessing Officer u/s 272A(1)(d) of the Act, on 05.09.2023.

2.

The grounds of appeal raised by the assessee are as follows: 1. The grounds of appeal mentioned hereunder are without prejudice to one another.

ITA No. 851/Rjt/2025 Shri Manishbhai Hiralal Raveshia

2.

Ld. Commissioner of Income-tax (Appeals), National Faceless Appeal Centre, Delhi [hereinafter referred to as the "CIT(A)"] erred on facts as also in law in confirming penalty of Rs. 40,000/- levied u/s 27 A (1) (d) of the Act. The penalty levied u/s 272A(1)(d) of the Act is totally unjustified on facts as also in law may kindly be deleted. 3. Your Honour's appellant craves leave to add, to amend, alter, or withdraw any or more grounds of appeal on or before the hearing of appeal. 3. Succinctly, the factual panorama of the case is that assessee before me is an Individual. In the case of the assessee, the return of the income was filed on 27.10.2017 for the assessment year 2017-18, declaring total income of Rs. 3,14,400/-. As per information available with the Department during the year under consideration, the assessee entered into transaction with M/S SIX Twenty Pvt Ltd and has made a total transaction of Rs. 24,65,000/- which includes “on money” in cash of Rs. 4,75,000/-. As an outcome of enquiry/perusal and analysis of details available on records, it was noticed that the transaction was unaccounted and unexplained investment. In view of above facts, the then AO (Jurisdictional AO) had reasons to believe that the income to the extent of Rs. 24,66,000/- had escaped assessment. Therefore, it was a fit case for issuance of notice u/s 148 of the I.T. Act, 1961 and the case was reopened for the A.Y. 2017- 18. The assessee had not filed income tax return in response to notice u/s 148 of the I.T. Act. Subsequently, notice u/s 142(1) of the Act, was issued to the assessee on 19.12.2022, 05.01 2023, 13.01.2023 and 15.02.2023, during the assessment procedure. But the assessee did not respond to any of the above notices. Accordingly, the assessment was completed 147 r.w.s 144 read with section 144B of the Income-tax Act on 31/03/2023 assessing the total income Rs.27,80,400/-. Simultaneously, penalty proceeding was initiated u/s 272A(1)(d) of the Act, on 31/03/2023 and the assessee was issued with notice for penalty u/s 274 read with section 272A(1) (d) on 31/03/2023 to show cause as to why an order imposing penalty u/s 272A(1)(d) should not be passed for failure to comply with the notices u/s 142(1) of the Act dated 19.12.2022, 05.01. 2023, 13.01.2023 and 15.02.2023, as per details given in the assessment order for the A.Y. 2017-18.

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ITA No. 851/Rjt/2025 Shri Manishbhai Hiralal Raveshia 4. In a response to the above notice, the assessee submitted reply during the penalty proceedings before the assessing officer stating that because of the mistake of the accountant, the assessee could not make the compliance of various notices, therefore, assessee should not be penalized because of the mistake of the accountant.

5.

However, the assessing officer, rejected the above reply of the assessee, and held that there is non-compliance of four notices, therefore, Assessing Officer has levied penalty in accordance with section 272A(1)(d) of the Act i.e. Rs. 10,000/- per default for four notices, cumulatively Rs.40,000/-.

6.

Aggrieved by the order of assessing officer, the assessee carried the matter in appeal before ld.CIT(A), who has confirmed the action of the assessing officer, therefore, assessee is in further appeal before this Tribunal.

7.

I have heard both the parties and carefully gone through the submission put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the fact of the case including the findings of the ld CIT(A) and other materials brought on record. Learner Counsel for the assessee submitted that accountant of the assessee did not response to the notices issued by the assessing officer during the assessment proceedings, therefore, because of the mistake of the accountant of the assessee, the assessee, should not be penalized, therefore, penalty may be deleted. The Learned Counsel further submitted that assessing officer has issued only one notice and thereafter the assessing officer has issued three reminders of the same notice, therefore, on account of three reminder letters, the penalty should not be imposed. On the other hand, the Ld. DR for the Revenue has primarily reiterated the stand taken by the Assessing Officer, which we have already noted in our earlier para and is not being repeated for the sake of brevity. I note that during the assessment proceedings, the assessing officer has issued the first show cause notice, to which

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ITA No. 851/Rjt/2025 Shri Manishbhai Hiralal Raveshia

the assessee’s accountant/advocate did not make the compliance. After that the notices issued by the assessing officer are not the notices but reminders of the first notice. Therefore, the penalty should not be imposed on account of reminder letters. Hence, I delete the penalty of Rs.30,000/- for three reminding letters and confirmed the penalty to the tune of Rs.10,000/- on account of first show cause notice. Therefore, I allow the appeal of the assessee partly in the above terms.

8.

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

Order is pronounced in the open court on 08/06/2026.

Sd/- (Dr. Arjun Lal Saini) लेखा सद�य/Accountant Member राजकोट/Rajkot िदनांक/ Date: 08/06/2026 Copy of the order forwarded to: 1. The assessee 2. The Respondent 3. CIT 4. The CIT(A) 5. DR, ITAT, RAJKOT 6. Guard File By order Assistant Registrar/Sr. PS/PS ITAT, Rajkot

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