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Facts
The assessee, an individual, failed to file a return of income for AY 2018-19. The case was reopened under Section 147 due to the sale of an immovable property without offering capital gains. The assessee did not respond to notices issued by the AO, leading to assessment and subsequent penalty proceedings under Section 272A(1)(d) for non-compliance with notices under Section 142(1).
Held
The Tribunal condoned the delay in filing the appeal, citing the assessee's ill health and hospitalization as a reasonable cause. The Tribunal found that the penalty levied under Section 272A(1)(d) was not justified as the non-compliance was due to the assessee's health issues and lack of knowledge of online tax procedures, considering the assessee is a senior citizen.
Key Issues
Whether the penalty for non-compliance with notices is justified when the assessee cites ill health and lack of technical knowledge as reasons for non-response, especially considering the provisions of Section 273B?
Sections Cited
147, 148, 142(1), 272A(1)(d), 273B, 151A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI
Before: SHRI GEORGE GEORGE K & SHRI S.R. RAGHUNATHA
आदेश /O R D E R
PER S. R. RAGHUNATHA, AM :
This appeal by the assessee is filed against the order of the Commissioner of Income Tax, Appeal, NFAC, Delhi, for the assessment year 2018-19, vide order dated 13.12.2024.
At the outset, we find that there is a delay of 4 days in appeal filed by the assessee, for which petition for condonation of delay along with reasons. The assessee submitted an affidavit for the delay stating that the delay is caused due to ill health. After considering the petition filed by the assessee and also hearing both
:-2-: ITA. No:673/Chny/2025 the parties, we find that there is a reasonable cause for the assessee in not filing appeal on or before the due date prescribed under the law and thus, in the interests of justice, we condone delay in filing of appeal and admit appeal filed by the assessee for adjudication. 3. The assessee has raised the following grounds of appeal:
1. The impugned Order is illegal, perverse and liable to be qualified
2. The Learned Appellate Authority erred in not considering the grounds and submission filed by the Appellant.
3. Without prejudice, the Impugned Penalty is unjust, as the reason for not responding to the notices issued during reassessment was that the reassessment proceeding was nil and void, on violation of Section 151A of the Act.
4. Without prejudice, the Impugned Penalty is excessive and unfair, as the term “each such failure” must not be associated with each notice of the same species, but restricted to lack of response towards notice(s) issued under different provisions of the Income Tax Act, contemplating different compliances during assessment, given that there is no maximum limit on the Officer to issue number of notices under the same provision for instance Section 142(1). And, for other reasons and grounds that may be adduced later, the Appellant humbly prays that the present appeal may be admitted, duly considered and justice be rendered.
4. The brief facts of the case are that the assessee is an individual and had not filed her return of income for the A.Y. 2018-19. Based on the information that the assessee had sold an immovable property for Rs.31,50,000/- and had not offered to capital gain tax. The case was re-opened u/s.147 of the Act by issuing a notice u/s.148 of the Act. However, the assessee did not respond to the notices of the AO and hence concluded the assessment on 12.02.2024 by making certain additions. Subsequently, the penalty proceedings u/s.272A(1)(d) was also initiated for non- compliance of notices issued u/s.142(1) of the Act dated 12.07.2023 and 04.09.2023.
During the reassessment proceedings the AO had issued statutory notices to file the required details for completing the assessment. However, the assessee had :-3-: ITA. No:673/Chny/2025 not responded to the said notices and hence the AO levied the penalty of Rs.20,000/- u/s.272A(1)(d) of the Act for default in complying for two notices at Rs.10,000/- each default. Aggrieved by the order of the AO, the assessee preferred an appeal before the ld. CIT(A), NFAC, Delhi.
The ld. CIT(A) also passed an exparte order on 2016-17 due to non- participation in appellate proceedings. Aggrieved by the order of the ld. CIT(A), the assessee is in appeal before us.
The ld.AR submitted that the notices calling for information were issued by the AO to the assessee could not be attended due to health issues and hospitalization. Further, the assessee being senior citizen is not having knowledge of accessing the online portal. Therefore, the penalty levied under section 272A(1)(d) of the Act for non-compliance of notices was not warranted as there was a reasonable cause to the assessee as per the provisions of Section 273B of the Act. In light of the above, the ld.AR prayed for setting aside the order of ld.CIT(A) by deleting the penalty levied.
Per contra, the ld.DR relied on the orders of the ld.CIT(A) and prayed for confirming the same since the assessee is a regularly non-compliant on the statutory notices issued by the AO.
We have heard both the parties, perused materials available on record and gone through orders of the authorities below. The fact with regard to the impugned dispute are that the assessee failed to comply to the notices issued by the AO for the A.Y. 2018-19 during the reassessment proceedings. Accordingly, the penalty u/s.272A(1)(d) of the Act has been levied for non-compliances to the notices issued u/s.142(1) of the Act at Rs.10,000/- per notice for 2 notices i.e. Rs.20,000/-. On appeal to the ld.CIT(A), the penalty has been confirmed by not accepting the submissions of the assessee in the appellate proceedings for A.Y.2018-19. On perusal of notices issued by the AO and the submissions made by the assessee, we note that the assessee was having health issues and hospitalized. Further, since the assessee is a senior citizen and is not having knowledge of accessing e-portal of the income tax website. Therefore, in our considered view the non-compliances to :-4-: ITA. No:673/Chny/2025 the notices by the assessee is not intentional and hence the assessee has given a ‘reasonable cause’ for non-response. In the present facts and circumstances of the case, the levying of penalty u/s.272(1)(d) for 2 notices at Rs.10,000/- each is not justified. Hence, we are inclined to delete the penalty to the tune of Rs.20,000/- levied u/s.272A(1)(d) of the Act by setting aside the order of the ld.CIT(A). Accordingly, we order.
In the result, the appeal filed by the assessee is allowed.
Order pronounced in the court on 13th August, 2025 at Chennai.