HANSABEN MAHENDRABHAI TALAVIYA,RAJKOT vs. ITO,WARD-1(1)(1), RAJKO, RAJKOT

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ITA 97/RJT/2026Status: DisposedITAT Rajkot09 April 2026AY 2013-145 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal found that the AO and CIT(A) did not establish deliberate non-compliance by the assessee. The notices were not clearly specified as to how they were served, and the assessee had submitted replies. Therefore, the penalty was deleted.

What were the facts?

The assessee's capital balance showed a significant unexplained difference between two assessment years. The Assessing Officer (AO) reopened the case and issued notices, to which the assessee responded by filing a return with nil income. A penalty was levied for non-compliance with notices.

What were the issues?

Whether the penalty under Section 271(1)(b) for non-compliance with notices was justified, given the lack of clear evidence of deliberate non-compliance and proper service of notices.

Which sections of the Income-tax Act were involved?

Section 147,Section 144,Section 142(1),Section 271(1)(b),Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, Rajkot Bench, Rajkot

Before: Dr. Arjun Lal Saini & Dr. Dinesh Mohan Sinha

For Appellant: Shri Mehul Ranpura, Ld. AR
For Respondent: Shri Abhimanyu Singh Yadav, Ld. Sr. DR
Hearing: 18/03/2026

आयकर अपील�य अ�धकरण, राजकोट �यायपीठ, राजकोट। In The Income Tax Appellate Tribunal, Rajkot Bench, Rajkot Before Dr. Arjun Lal Saini, Accountant Member And Dr. Dinesh Mohan Sinha, Judicial Member आयकरअपीलसं./ITA No. 97/Rjt/2026 (�नधा�रणवष�/Assessment Year: (2013-14) Smt. Hansaben Mahendrabhai Talaviya The Income Tax Officer, Ashiyana, Paras Society Street No.1, Ward-1(1)(1) Vs. Nirmala Convent School Road, Rajkot- Aayakar Bhavan, Race Course 360005 Ring Road, Rajkot �ायीलेखासं./जीआइआरसं./PAN/GIR No.: ADNPP3110E (अपीलाथ�/Appellant) (��यथ�/Respondent) Appellant by : Shri Mehul Ranpura, Ld. AR Respondent by : Shri Abhimanyu Singh Yadav, Ld. Sr. DR Date of Hearing : 18/03/2026 : 09/04/2026 Date of Pronouncement ORDER Per, Dr. Dinesh Mohan Sinha, JM: Captioned appeal filed by assessee pertaining to Assessment Year 2013-14, is directed against the order passed under section 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) by the Learned Commissioner of Income-tax (Appeal), (in short ‘Ld. CIT(A)’), dated 07.11.2025, which in turn arises out of assessment order passed by Assessing Officer u/s. 147 r.w.s. 144 of the Act on 30.03.2022.

2.

The grounds of appeal raised by the assessee are as under: 1. The grounds of appeal mentioned hereunder are without prejudice to one another. 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.30,000/- levied u/s. 271(1)(b) of the Act. The penalty levied u/s. 271(1)(b) 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.

The brief facts of the case are that as per information received by the department, the assessee had shown opening balance of capital as on 01.04.2012 (i.e. AY 2013-14) is Rs.1,30,15,236/-however, as per the ITR of the assessee for the A.Y. 2012-13, the closing capital balance is shown as Nil. Thus, a difference of Rs.1,30,15,236/- in the capital balance was an unexplained credit. On perusal of this information and other preliminary inquiry done by the Jurisdictional Assessing Officer, the case was reopened for assessment after recording reasons to believe that income more than Rs. 1,00,000/-may have escaped assessment, and after obtaining prior approval from the Pr. Commissioner of Income Tax. The assessee was issued a notice u/s 148 of the Income Tax Act, 1961 (hereafter referred to as the Act) through ITBA on 31.03.2021 for AY2013-14. In response to notice u/s 148, the assessee filed her return of income for the said period by declaring same Nil income on 26.11.2021. An information in the form of verification details received from the ITO(Inv.), Rajkot. List of the report is reproduced below.

Total Taxable income admitted by the Nil assessee in ROI filed in response of noticed u/s 148. Add: Unexplained money of Rs.1,30,15,236/- (as Rs.1,30,15,236/- discussed in para 8) Assessed Income (round-off) Rs.1,30,15,236/-

4.

Aggrieved by the order of the AO, the assessee came in appeal before the Ld. CIT(A) who was dismissed the assessee’s appeal by observing as under:

4.1 During the appellate proceedings, the appellant submitted the penalty order dated 27.09.2022, Form 35 and Grounds of appeal which have been perused carefully. 4.2 On perusal of the penalty order, it is observed that the appellant did not comply to the notices dated 19.11.2022, 09.02.2022 and 23.02 2022 issued u/s 142(1) of the Income Tax Act, 1961. Further, it is observed that the AO has passed the assessment order u/s 144 rws 147 of the IT Act, 1961 on 27.09.2022. Therefore, it is a case of absolute non-appearance of the appellant before the Assessing Officer. 4.3 However, during the appellate proceedings, the appellant failed to explain any satisfactory reason/evidence for non-compliance of the notices issued u/s 142(1) of the Income Tax Act, 1961 dated 19.11 2021, 09.02.2022 and 23.02.2022. The submission made by the appellant has been considered but not accepted. The appellant had no reasonable cause for non-compliance to the notices issued u/s. 142(1) during the assessment proceedings. Accordingly, the penalty levied u/s. 271(1)(b) by the AO amounting Rs. 30,000/- is confirmed. The contention of the appellant is rejected. 5.0 As a result, the appeal of the appellant is dismissed.

5.

Aggrieved by the impugned order of the Ld. CIT(A), the assessee came in appeal before us.

a. During the course of hearing, the appellant is engaged in the business of trading in shares and securities through recognized stock exchange and also derived income from other sources like interest and dividend etc. and also the assessment of the assessee completed under section- 144 r.w.s. 147, total assessed income of Rs.1,30,15,236/- and penalty proceeding u/s.271(1)(b) of the Act was initiated for non-compliance of different notices. b. On the other hand, the Learned DR for the revenue relied on the findings of the Ld. CIT(A).

6.

We have heard, both the parties and carefully perused the material available on record, including the findings of the ld. CIT(A) and other material. Considering the above facts, neither the Ld. CIT(A) nor the AO has recorded the finding that the due notice dt. 19.11.2021 complied with by the assessee and return was filed in compliance on 26.11.2021 and the same is acknowledged in the assessment order itself at column No.10.2. During the course of assessment, the assessee has submitted reply on dt. 21.02.2022 and 27.03.2022 through online mode. We further note that while passing the assessment order for AY 2013-14, the penalty was initiated for non- compliance of notice dt. 09.02.2022 and 23.02.2022, while penalty order speaks that there was a non-compliance of the notice dt. 19.11.2021, 09.02.2022 and 23.02.2022. The penalty order also do not specified that which mode the notices u/s. 142(1) of the Act was sent and served upon the assessee. It only says that notice served upon the assessee from time to time through registered E-mail ID/RPAD. We further note that there was no finding of the authority that there was a deliberate non-compliance of notice by the assessee.

7.

Considering the above facts and circumstances of the case, we are therefore delete the penalty.

8.

In the result, the appeal of the assessee is allowed, for statistical purposes.

Order is pronounced in the open Court Today on 09/04/2026.

Sd/- Sd/- [ Dr. Arjun Lal Saini ] [ Dr. Dinesh Mohan Sinha ] Accountant Member Judicial Member //True Copy// राजकोट/Rajkot िदनांक/ Date: 09/04/2026 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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