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Income Tax Appellate Tribunal, DELHI “SMC-1” BENCH: NEW DELHI
Before: SHRI KUL BHARAT
This appeal filed by the assessee for the assessment year 2011-12 is directed against the order of learned CIT(A)-27, New Delhi dated 28.05.2019.
The assessee has raised following grounds of appeal:-
“That on the facts and the circumstances of the case and the provisions of the law, the order passed by Ld. Assessing Officer is bad in law.
2. That the Ld. Assessing Officer was not justified on facts and circumstances of the case in imposing penalty of Rs.10,000/- u/s 271(1)(b) of the IT Act on account of alleged failure in compliance to notice u/s 142(1) of the Act.”
The only effective ground in this appeal is against the imposing of penalty of Rs. 10,000/- u/s 271(1)(b) of the Income Tax Act, 1961 (“the Act”).
Facts giving rise to the present appeal are that notice u/s 153A of the Act was issued on 22.09.2017 to the assessee. Further, a show cause notice dated 22.03.2018 was issued fixing the case for hearing on 28.03.2018. Another notice u/s 153A of the Act was issued on 02.08.2018. Again, another notice was again issued on 13.08.2018 u/s 143(2) of the Act alongwith questionnaire fixing the date of hearing on 23.08.2018. Another notice dated 07.09.2018 was issued and the case was fixed for hearing on 14.09.2018. On the compliance of the said notice, the assessee had filed income tax return. However, the Assessing Officer issued another notice u/s 142(1) of the Act on 05.10.2018 fixing the date of hearing on 25.10.2018. It is observed by the Assessing Officer that on the date of hearing, no one was appeared. Therefore, the Assessing Officer issued a penalty notice u/s 274 r.w.s. 271(1)(b) of the Act fixing the case for hearing on 19.11.2018. On 19.11.2018, no one was appeared, therefore, the Assessing Officer imposed penalty of Rs.10,000/- u/s 271(1)(b) of the Act vide order dated 06.12.2018.
Aggrieved by this, the assessee preferred appeal before Ld.CIT(A) who after considering the submissions, dismissed the appeal of the assessee.
Now, the assessee is in appeal before the Tribunal.
Ld. Counsel for the assessee submitted that the assessee has shown sufficient reasons for non-compliance of the notice. He submitted that the authorities below had not taken the facts in right perspective. He further submitted that the Assessing Officer has noted that in response the notice, the assessee had filed income tax returns as well as bank statements. He submitted that it is not the case where there was no compliance on the part of the assessee. He further submitted that undisputedly the assessment order was passed u/s 153A r.w.s. 143(3) of the Act. It is not the case where the assessee has not participated in the assessment proceedings.
Per contra, Ld. Sr.DR opposed the submissions and supported the order of the authorities below.
I have heard the rival submissions and perused the material available on records. It is the contention of the assessee that he has reasonable cause for non-appearance before the Assessing Officer. It is also submitted that under the identical facts, the Tribunal has deleted the penalty. Ld. Counsel for the assessee has relied upon the decision of Gyan Mata Radha Satyam Kriyayog Ashram Research Institute vs. Income Tax Officer in ITA No.95/Alld./2020 vide order dated 25.02.2021 wherein the Tribunal has held as under:-
6. “On the one hand, the Assessing Officer has given the date of compliances in the above table whereas the penalty was imposed on the ground that the above notices were not complied by the assessee. Further, the Assessing Officer has also stated that the assessee has not made compliance to the show cause notice issued u/s. 271(1)(b). However, that cannot be a ground for imposition of penalty u/s. 271(1)(b) of the Act. In the quantum appeal, the ld. CIT(A) vide its order dated 22.09.2020 has deleted the addition made by the Assessing Officer and therefore, it amounts to acceptance of the explanation of the assessee filed during the assessment proceedings. Hence, in the facts and circumstances of the case and in view of Section 273B of the Act when the assessee has finally complied with the notice issued by the Assessing Officer the penalty is not imposable as the explanation filed by the Gyan
Mata Radha Satyam Kriyayog Ashram Research assessee was finally found to be correct and accepted in the quantum appeal. Consequently the penalty levied u/s. 271(1)(b) of the Act is deleted.”
Reliance is also placed on the decision of Co-ordinate Bench of this Tribunal in Anil Kumar Seth vs DCIT in to 7522/Del/2017 vide order dated 22.06.2018.
Respectfully following view of the Co-ordinate Benches (supra), the penalty u/s 271(1)(b) of the Act on account of alleged failure in compliance to notice u/s 142(1) of the Act, involved in respect of assessment year 2011-12 stand deleted and the grounds raised by the assessee in this appeal are allowed.
In the result, the appeal of the assessee is allowed.
Above decision was pronounced on conclusion of Virtual Hearing in the presence of both the parties on 28th April, 2021.