SRINIVAS BODDULA,HYDERABAD vs. ITO, WARD-4(1), HYDERABAD

During the course of the assessment proceedings, the AO, inter alia, issued notice under section 142(1) of the Act, dated 18/07/2024 (seeking compliance up to 02/08/2024) and notice under section 142(1) of the Act, dated 20/08/2024 (seeking compliance up to 27/08/2024). Also, as the assessee had failed to comply with both the aforementioned notices, the AO issued a reminder letter dated 29/08/2024, calling for requisite compliance within 05 days.

Thereafter, the AO vide order under section 147 r.w.s 144 r.w.s 144B of the Act, dated 17/01/2025, framed the assessment determining the income of the assessee at Rs.3,70,670/-. The AO, while culminating the assessment, initiated penalty proceedings under section 272A(1)(d) of the Act for non-compliance with the notices issued under section 142(1) of the Act, dated 18/07/2024 and 20/08/2024, respectively.

Thereafter, the AO issued notices under section 274 r.w.s 272A(1)(d) of the Act, dated 31/12/2024 and 30/06/2025, but the assessee failed to comply with either of them. The AO observed that as the assessee had failed to comply with the notices issued under section 142(1) of the Act, dated 18/07/2024 and 20/08/2024, he called upon him to show cause as to why a penalty may not be imposed under section 272A(1)(d) of the Act.

Ostensibly, the assessee vide his letter dated 08/05/2025 had in the course of the penalty proceedings submitted before the AO that as he had no knowledge of his Income Tax portal account nor was availing the services of any Tax Consultant during the period when the notices under section 142(1) of the Act were issued, thus, for the said reason he had failed to comply with the same. However, the AO did not find favor with the explanation of the assessee and imposed the penalty under Section 272A(1)(d) of the Act of Rs.10,000/- for each of the aforesaid defaults, therein aggregating to an amount of Rs.20,000/-.

Aggrieved, the assessee carried the matter in appeal before the CIT(A).

As the assessee, despite having been put to notice about the fixation of the appeal on three occasions, had not effectively participated in the proceedings, the CIT(A), finding no infirmity in the view taken by the AO, upheld the penalty imposed under section 272A(1)(d) of the Act and dismissed the appeal. For the sake of clarity, we deem it apposite to cull out the observations of the CIT(A), as under:

The assessee, aggrieved with the order of the CIT(A), has carried the matter in appeal before us.

We have heard the Learned Authorized Representatives of both parties, perused the orders of the authorities below, and considered the material available on record.

Shri S Rama Rao, Advocate, Learned Authorized Representative (for short, “Ld. AR”) for the assessee, at the threshold of hearing of the appeal submitted that as the AO vide his notice issued under section 142(1) of the Act, dated 20/08/2024 had called upon the assessee to furnish his reply latest by 27/08/2024, i.e., within a period of less than 7 days, therefore, the said notice in itself was invalid and no penalty for 5 Srinivas Boddula vs. ITO non-compliance of the same could have been imposed. Apart from that, the Ld. AR submitted that as at the relevant point of time, the notices issued under section 148 of the Act by the Juri ictional Assessing Officer (JAO) were held by the Hon’ble High Courts as devoid and bereft of any substance; thus, non-compliance with such invalid notice could not attract a penalty under section 272A(1)(d) of the Act.

Per contra, Dr. Sachin Kumar, Learned Senior Departmental Representative (for short, “Ld. Sr-DR”), relied upon the orders of the authorities below. It was specifically pointed out by him that as the notice under section 142(1) of the Act, dated 20/08/2024, was followed by a reminder, dated 29/08/2024, the Ld. AR’s contention that the AO had allowed a time period of less than 7 days for furnishing the requisite details was devoid and bereft of any substance. Also, the Ld. Sr-DR objected to the assessee’s contention that, as the notices under section 148 of the Act issued by the Juri ictional Assessing Officer (JAO) at the relevant point of time were held as invalid by various Hon’ble High Courts, the same justified the non-compliance of the notices issued by the AO under section 142(1) of the Act.

We have given thoughtful consideration to the contentions advanced by the Learned Authorized Representatives of both parties in the backdrop of the material available on record.

At the threshold, we may herein observe that there is no substance in the Ld. AR’s contention that the notice under section 142(1) of the Act, dated 20/08/2024, had allowed a period of less than 7 days to the assessee for furnishing the requisite details, the same was thus in itself invalid. We say so, for the three fold reasons, viz., (i) that there is nothing contemplated under section 142(1) of the Act which requires allowing of a period of not less than 7 days to the assessee for furnishing the requisite details; (ii) that even otherwise the time allowed by the AO vide notice issued under section 142(1) of the Act, dated 20/08/2024 (seeking compliance by 27/08/2024) involved a period of 8 days for compliance; and (iii) that though the notice issued under section 142(1) of the Act, dated 20/08/2024 was followed by a reminder letter dated 29/08/2024, which thiugh allowed a further period of 5 days to the assessee to effect necessary compliance but still the needful was not done within the stipulated time period.

Coming to the second contention of the Ld.AR, that as the notices under section 148 of the Act issued by the Juri ictional Assessing Officer (JAO) at the relevant point of time were held by the Hon’ble High Courts as invalid, therefore, the notices issued under section 142(1) of the Act, dated 18/07/2024 and 20/08/2024, were in themselves non-est and invalid. We are unable to comprehend the aforesaid contention of the Ld. AR. In our view, as the assessee has failed to effect compliance with the notices issued under section 142(1) of the Act, dated 18/07/2024 and 20/08/2024, the AO had rightly imposed a penalty of Rs.10,000/- for each of the defaults under section 272A(1)(d) of the Act.

Before parting, we may herein observe that the CIT(A), while upholding the penalty under section 272A(1)(d) of the Act, has rightly observed that it was ironical that the assessee had filed an appeal against the penalty imposed for non-compliance, but had been non- compliant even during the course of the proceedings before him. In our view, considering the totality of the facts and the conduct of the assessee, we find no infirmity in the penalty imposed by the AO under section 272A(1)(d) of the Act, which, thereafter, had rightly been upheld by the CIT(A).

In the result, the appeal filed by the assessee, being devoid and bereft of any substance, is dismissed.

The Principal Commissioner of Income Tax, Hyderabad.

"वभागीय""त"न"ध, आयकरअपील"यअ"धकरण /DR,ITAT, Hyderabad.

The Commissioner of Income Tax 6. गाड"फ़ाईल / Guard file