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Facts
The assessee filed an appeal against the penalty order after a delay of 123 days. The delay was attributed to the tax consultant's email account not being in use. The CIT(A) dismissed the assessee's appeal ex-parte for non-prosecution.
Held
The Tribunal condoned the delay, holding that the assessee had sufficient cause and the delay was not intentional. The Tribunal also directed the CIT(A) to adjudicate the penalty issue on merits, as the CIT(A) had not dealt with the case's merits.
Key Issues
Whether the delay in filing the appeal should be condoned, and whether the CIT(A) erred in dismissing the appeal ex-parte without considering the merits.
Sections Cited
271(1)(c), 250, 143(3), 274
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, A BENCH,
Before: Dr. MANISH BORAD & SHRI VINAY BHAMORE
Year: 2011-2012 Ashok Gurunath Patil, ITO, Ward 1(1), Latur A/p Masobavadi, Khed, Nilanga, Latur-413522 Vs. Maharashtra PAN-BIHPP0618K अपीलेंर्थी / Appellant प्रत्यर्थी/Respondent Assessee by: Shri Pratik Sandbhor Department by: Shri Ramnath P Murkunde Date of hearing: 24-09-2025 Date of Pronouncement: 06-10-2025 आदीश/ORDER PER DR. MANISH BORAD, ACCOUNTANT MEMBER:- This appeal at the instance of the assessee is directed against the order of Ld. CIT(A), NFAC, Delhi passed u/s 250 of the Income-tax Act, 1961 dated 21.08.2024 which is arising out of Order passed u/s 271(1)(c) of the Act dated 27.02.2018.
Registry has informed that there is a delay of 123 days in filing of the appeal. Application for condonation of delay alongwith affidavit has been filed and placed at Page No. 24-26 of the appeal citing the main reason for the delay, that the assessee was not aware of passing of the impugned order as the Tax Consultant registered the e-mail Id of his younger son and the e-mail account was not in use. After hearing the Ld. Departmental Representative (DR) and perusing the records we find that the sufficient cause prevented the assessee from filing the appeal within the prescribed time limit and the delay is not intentional. Therefore in the larger interest of justice and also placing reliance on the judgement of Hon’ble Apex Court in the case of Collector, Land Acquisition vs. Master Katiji and Others(1987) 167 ITR 471(SC) (Supreme Court) and in the case of Inder Singh Vs State of Madhya Pradesh judgement dated 21.03.2025 (2025) INSC 382) we hereby condone the delay of 123 days and admit the appeal for adjudication on merits.
Assessee has raised following grounds of appeal:-
1. On the facts and in the circumstances of the case and in law the Ld. CIT(A) erred in dismissing the appeal ex-parte.
2. On the facts and in the circumstances of the case and in law the Penalty Order u/s 271(1)(c) of the Income Tax Act, 1961 is invalid and bad in law.
3. On the facts and in the circumstances of the case and in law the penalty order u/s 271(1)(c) is invalid and bad in law in as much as the penalty has been initiated for concealment of income whereas the penalty has been levied for furnishing inaccurate particulars of income
4. On the facts and in the circumstances of the case and in law the penalty order u/s 271(1)(c) is invalid and bad in law in as much as the notice u/s 274 rws 271(1)(c) of the income Tax Act, 1961 does not specify the particular limb for which penalty has been initiated.
5. On the facts and in the circumstances of the case and in law the Assessing Officer erred in levying penalty of Rs. 16,52,276/- u/s 271(1)(c) of the Income Tax Act, 1961.
On the facts and in the circumstances of the case and in law and without prejudice to the above grounds of appeal the Assessing Officer erred in levying penalty u/s 271(1)(c) of the Income Tax Act, 1961 without taking cognizance of the fact that the appellant did not offer the interest on enhanced compensation on compulsory acquisition of property to taxation under a bonafide belief that same is not taxable.
On the facts and in the circumstances of the case and in law and without prejudice to the above grounds of appeal the Assessing Officer erred in levying penalty u/s 271(1)(c) of the Income Tax Act, 1961 without taking cognizance of the fact that the issue of taxability
of interest on enhanced compensation on compulsory acquisition of property is a debatable issue and no penalty can be levied u/s 271(1)(c).
8. On the facts and in the circumstances of the case and in law and without prejudice to the above grounds of appeal the Assessing Officer erred in levying penalty u/s 271(1)(c) of the Income Tax Act, 1961 in as much as the appellant has earned interest income of Rs. 1,18,626/- which is below the taxable limit and therefore the same is not taxable.
On the facts and in circumstances of the case and in law and without prejudice to the above grounds of appeal no penalty u/s 271(1)(c) of the Income Tax Act, 1961 could be levied merely because the claim of the appellant is denied which is otherwise supported by judicial precedents. 10.The above grounds may be allowed to be altered, amended, modified, deleted etc in the interest of natural justice.
4. At the outset Ld. Counsel for the assessee submitted that the impugned order is ex-parte as the assessee failed to make proper compliance to the notice of hearing. Prayer made to afford one more opportunity to go before Ld. CIT(A).
On the other hand Senior DR supported the order of the lower authorities.
6. We have heard rival contentions and perused the record placed before us. The assessee is an individual and filed return of income on 31.03.2012 declaring Nil income. Assessment u/s 143(3) of the Act completed on 12.03.2014 wherein Ld. Assessing Officer (AO) made additions totaling to Rs. 75,73,111/- Ld. AO also initiated the penalty proceedings u/s 271(1)(c) of the Act and vide order dated 27.02.2018 levying penalty at Rs. 16,52,300/- Aggrieved with the order of Ld. AO levying penalty u/s 271(1)(c) of the act assessee appealed before Ld. CIT(A) and filed the appeal on 20.09.2018. Ld. CIT(A) issued various notices of hearing during F.Y. 2019- 20 to F.Y. 2024-25 but assessee failed to furnish any documentary and written submissions. As a result of which Ld. CIT(A) dismissed the assessee’s appeal in limine for non prosecution.
7. We observe that Ld. CIT(A) has not dealt with the merits of the case. Hon’ble Bombay High Court in the case of Pr.CIT(Central) Vs. Premkumar Arjundas Luthra (HUF) Bombay (2017) 297 CTR 614 (Bombay) has held that Ld. CIT(A) NFAC is obligated to dispose off the appeal on merits even in an ex- parte order. We therefore considering the facts and circumstances of the case and also in the larger interest of justice deem it appropriate to restore the issue in the instant appeal regarding the levy of penalty u/s 271(1)(c) of the Act for necessary adjudication by Ld. CIT(A) and to pass a speaking order as contemplated u/s 250(6) of the Act. Needless to mention that proper opportunity of hearing shall be granted to the assessee. Assessee is also directed to remain vigilant and not to take adjournment unless otherwise required for reasonable cause. Effective grounds of appeal raised by the assessee are allowed for statistical purposes.
In the result appeal of the assessee is allowed for statistical purposes.
Order pronounced on this 06th day of October, 2025.
Sd/- Sd/- (VINAY BHAMORE) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER प णी/ Pune; ददिेंंक /Dated: 06th October, 2025. Neeta आदीश की प्रधिधलधप अग्रीधर्ि /Copy of the Order forwarded to: 1.अपीलेंर्थी / The Appellant. 2.प्रत्यर्थी / The Respondent. 3.The Pr. CIT concerned. 4.धवभेंगीय प्रधिधिधि, आयकर अपीलीय अधिकरण, "A" बाच, प णी / DR, ITAT, "A" Bench, Pune. 5.गेंर्ा फेंइल / Guard File. आदीशेंि सेंर / BY ORDER,
Senior Private Secretary आयकर अपीलीय अधिकरण, प णी /ITAT, Pune.