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Income Tax Appellate Tribunal, HYDERABAD BENCHES “B”, HYDERABAD
Before: SHRI LALIET KUMAR & SHRI MADHUSUDAN SAWDIA
O R D E R PER MADHUSUDAN SAWDIA, A.M:
This appeal filed by Gangadhar Agarwal, Hyderabad (“the assessee”), feeling aggrieved by the order passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi (“Ld. CIT(A)”), dated 09/11/2024 for the AY 2017- 18.
The assessee has raised the following grounds of appeal:
“1. The order of the Ld. CIT(A) u/s. 250 of the Act dated 09/10/2024 is erroneous both on facts and in law to the extent the order is prejudicial to the interests of the appellant.
2. The Ld. CIT(A) erred in dismissing the appeal.
3. The Ld. CIT(A) ought to have appreciated that the assessee has a reasonable cause for the non-compliance to the impugned order.
4. The Ld. CIT(A) ought to have appreciated that the provisions of section 273B of the Act are applicable to the appellant’s case and that therefore no penalty is exigible in the appellant’s case.
5. The Ld. CIT(A) ought to have appreciated the fact that the AO has not mentioned any specific date of non-compliance and that the penalty levied for Rs. 10,000/- is invalid.
6. The Ld. CIT(A) ought to have appreciated that, where there is no specific date of non-compliance mentioned for imposing penalty, the penalty order itself is invalid and bad in law.
Appellant may, add or alter or amend or modify or substitute or delete and / or rescind all or any of the grounds of appeal at any time before or at the time of hearing of the appeal.”
Brief facts of the case are that, the assessee is an individual, filed his return of income for the AY 2017-18 on 08/12/2017 admitting a total income of Rs. 14,87,800/-. The assessee’s case was selected for scrutiny under Computer Aided Scrutiny Selected (“CASS”) for the year under consideration and the assessment was completed U/s. 143(3) of the Act on 23/12/2019 at income of Rs. 5,34,00,399/-. During the assessment proceedings, the Ld. AO issued notices U/s. 143(2) and 142(1) of the Act to the assessee. However, the assessee has not complied with the notices issued by the Ld. AO. Accordingly, the Ld. AO levied penalty of Rs. 10,000/- U/s. 272A(1)(d) of the Act on the assessee.
Aggrieved by the order of the Ld. AO, the assessee filed appeal before the Ld. CIT(A). Not convinced by the submissions of the assessee, the Ld. CIT(A) dismissed the appeal of the assessee.
Aggrieved by the order of the Ld. CIT(A), the assessee is in appeal before us.
The Learned Authorized Representative (“Ld. AR”) submitted that, although there were lapses on the part of the assessee to respond to the two notices issued by the Ld. AO, but finally, the assessment for the Assessment Year under consideration has been completed by the Ld. AO U/s. 143(3). Under the similar circumstances, the Coordinate Bench of the ITAT in the case of Bhavna Modi vs. ITO in (AY: 2020-21), dated 16/08/2024 has deleted the penalty levied by the Ld.AO U/s. 272A(1)(d) of the Act.
Relevant portion (Para-8) from the order of the ITAT, Raipur (supra) is extracted as under:
“8. We have considered the rival submissions, perused the material available on record and case laws relied upon by the assessee. Admittedly, in the present case, the assessee failed to respond certain notices of the Ld. AO, which were issued u/s 143(2) and 142(1) of the Act, however, in response, subsequent notices, the assessee has made necessary replies and accordingly assessment was completed u/s 143(3), therefore, respectfully, following the analogy drawn in the decision referred to (supra), we find that the penalty-imposed u/s 272A(1)(d) of the Act is not justifiable in the present case, as the Ld. AO himself has deemed to have condoned the absence of assessee or his Authorized Representative on earlier occasions, subsequently the necessary information and evidences were furnished by the assessee to assist in the completion of the assessment and since assessment was completed u/s 143(3) of the Act, the penalty u/s 272A(1)(d) cannot be imposed. Under such facts and circumstances, considering the ratio of law followed in various judicial decision, we find it appropriate to set aside the order of Ld. CIT(A), and direct the Ld. AO to delete the penalty.”
7. Relying on the decision of the ITAT, Raipur Bench in the case of Bhavna Modi vs ITO (supra), the Ld. AR prayed before the Bench to delete the penalty levied by the Ld. AO U/s. 272A(1)(d) of the Act.
Per contra, the Learned Departmental Representative (“Ld. DR”) submitted that, although the order has been passed U/s. 143(3) of the Act, there were non-compliances on the part of the assessee to the notices issued by the Ld. AO. Hence, penalty levied by the Ld. AO U/s. 272A(1)(d) should not be deleted.
We have heard the rival contentions and gone through the material available on record in line with the submissions made by the either side. There is no dispute about the fact that the assessee failed to respond to certain notices of the Ld. AO. There is also no dispute on the fact that the order of the Ld. AO have been completed U/s. 143(3) of the Act on the basis of subsequent compliances made by the assessee. We have gone through the decision of the Coordinate Bench of ITAT, Raipur in the case of Bhavna Modi vs ITO (supra), as stated above, wherein, under the similar circumstances, the ITAT has deleted the penalty levied by the Ld. AO U/s. 272A(1)(d) of the Act. Respectfully following the decision of the ITAT, Raipur Bench (supra), we direct the Ld. AO to delete the penalty levied U/s. 272A(1)(d) of the Act.
In the result, appeal of the assessee is allowed.
Order pronounced in the Open Court on 13th January, 2025.