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Facts
The assessee did not file a return of income for A.Y. 2015-16, leading to a reopening of the case under Section 147. During reassessment proceedings, the assessee failed to respond to statutory notices under Section 142(1), which led the AO to levy a penalty of Rs. 20,000/- under Section 271(1)(b) for non-compliance. The CIT(A) upheld the penalty.
Held
The Tribunal upheld the penalty, noting the assessee's consistent non-compliance throughout the proceedings, including repeated failures to appear before the Tribunal. It found no infirmity in the lower authorities' orders, as the statutory defaults were admitted and unexplained. Consequently, the appeal filed by the assessee was dismissed.
Key Issues
Whether the penalty levied under Section 271(1)(b) for non-compliance with notices issued during reassessment proceedings and persistent non-appearance was justified.
Sections Cited
147, 142(1), 271(1)(b)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, Hyderabad ‘B’ Bench, Hyderabad
Before: SHRI VIJAY PAL RAO & SHRI MADHUSUDAN SAWDIA
आदेश/ORDER PER MADHUSUDAN SAWDIA, A.M. : This appeal is filed by Ms. Varahala Sobha Rani (“the assessee”), feeling aggrieved by the order passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (“Ld. CIT(A)”), dated 07.04.2025 for the A.Y. 2015-16.
The assessee has raised the following grounds of appeal :
1. 3. The brief facts of the case are that, the assessee did not file any return of income for the year under consideration. Consequently, the case was reopened under section 147 of the Income Tax Act, 1961 (“the Act”). During the reassessment proceedings, the assessee did not respond to the statutory notices issued by the Learned Assessing Officer (“Ld. AO”) under section 142(1) dated 12.07.2023 and 08.11.2023. On account of such non-compliance, the Ld. AO initiated penalty proceedings under section 271(1)(b) of the Act. Even during the penalty proceedings, the assessee failed to respond to the show cause notices. Accordingly, the Ld. AO levied penalty of Rs.20,000/- (being Rs.10,000/- for each of the two defaults) vide penalty order dated 22.07.2024 for A.Y. 2015–16.
4. Aggrieved with the order of Ld. AO, the assessee filed appeal before the Ld. CIT(A). The Ld. CIT(A), after considering the submission of the assessee, upheld the penalty and dismissed the appeal.
5. The assessee has now preferred this appeal before the Tribunal. The case of the assessee was fixed for hearing on 23.07.2025, but neither the assessee nor its authorised representative appeared on that day. The case was adjourned to 10.09.2025. Again, there was no appearance. Even on today’s date of hearing, there was no representation from the side of the assessee.
Therefore, we proceed to adjudicate the appeal after hearing the Learned Departmental Representative (“Ld. DR”).
The Ld. DR submitted that the conduct of the assessee throughout the proceedings shows persistent non-compliance. The assessee neither filed return of income voluntarily, nor responded to notices during reassessment, nor complied with penalty notices, and even at the appellate stage before the Tribunal, has failed to appear.
He submitted that the levy of penalty of Rs.20,000/- under section 271(1)(b) of the Act is squarely justified, as the statutory defaults are admitted and unexplained. He therefore prayed that the orders of the lower authorities be upheld and the appeal be dismissed.
We have considered the submissions of the Ld. DR and perused the material available on record. Despite several opportunities, neither the assessee nor any authorised representative has appeared before us to explain the reasons for non-compliance. The assessee also did not file any written submissions. The record clearly shows that the assessee failed to respond to statutory notices issued under section 142(1) dated 12.07.2023 and 08.11.2023, which are mandatory in nature. Even during penalty proceedings, the assessee did not file any reply. Such consistent conduct of non-compliance has continued before the Tribunal as well.
Penalty under section 271(1)(b) of the Act is attracted where there is failure to comply with notices issued under section 142(1) of the Act. The Ld. AO has levied penalty of Rs.20,000/- (being Rs.10,000/- per default) which is in accordance with law. The Ld. CIT(A) has confirmed the levy after due consideration of facts. In the absence of any explanation or evidence from the assessee and given the repeated defaults, we find no infirmity in the orders of the lower authorities. The appeal, therefore, deserves to be dismissed.
Accordingly, the appeal filed by the assessee is dismissed. The penalty of Rs.20,000/- levied under section 271(1)(b) of the Act is hereby upheld.
In the result, the appeal filed by the assessee is dismissed.