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Facts
The assessee appealed an order by the CIT(A) which arose from a penalty order for Assessment Year 2010-11. The assessee had challenged a penalty levied on 21.06.2018. The appeal was filed with a significant delay of 948 days.
Held
The Tribunal condoned the delay in filing the appeal, noting the assessee's contention that confusion arose due to two penalty orders being served simultaneously. The Tribunal quashed the penalty under Section 271B of the Act.
Key Issues
Whether the penalty under Section 271B is leviable when the assessee has already settled the dispute regarding penalty under Section 271A for failure to maintain books of accounts, and whether the delay in filing the appeal should be condoned.
Sections Cited
271B, 271A, 44AB, 4, 271
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Income Tax Appellate Tribunal, JAIPUR BENCHES,”SMC” JAIPUR
Before: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI, vk;dj vihy la-@ITA No. 341/JP/2025
आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”SMC” JAIPUR Mk0 ,l- lhrky{eh] U;kf;d lnL; ,oa Jh jkBksM deys'k t;UrHkkbZ] ys[kk lnL; ds le{k BEFORE: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI, vk;dj vihy la-@ITA No. 341/JP/2025 fu/kZkj.k o"kZ@Assessment Year : 2010-11 cuke Badri Narayan Choudhary ITO, Vs. 3356, Govind Rao Ji Ka Rasta Ward 4(1), Chandpole Bazar, Jaipur Jaipur LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: ADEPC3076D vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Sh. Ashish Khandelwal, CA jktLo dh vksj ls@ Revenue by : Sh. Gautam Singh Choudhary, JCIT lquokbZ dh rkjh[k@ Date of Hearing : 10/07/2025 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 06/08/2025 vkns'k@ ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM
On being aggrieved by the order of the National Faceless Appeal Centre, Delhi [ for short CIT(A)] dated 23/05/2022 the above named assessee preferred the present appeal. The dispute relates to the assessment year 2010-11. The said order of the ld. CIT(A) arises because the assessee has challenged the order for levy of penalty on 21.06.2018 the Income Tax Officer, Ward -4(1), Jaipur [ for short AO].
In this appeal, the assessee has raised following grounds: - “1. That ld. CIT(A) has erred in law as well as in facts of the case in treating deemed withdrawal of appeal as per clause 2 of section 4 of DTVSV Act 2020 even when appellant never opted for DTVSV scheme are filed any application for withdrawal.
2. That the lower authorities have erred in law as well in facts is imposing/confirming penalty u/s 271B even when the penalty was already imposed u/s 271A of the Act.
That the appellant reserves his right to add, amend, alter or withdraw any ground of appeal or before or before hearing of this appeal.”
3. At the outset of hearing, the Bench observed that there is delay of 948 days in filing of the appeal by the assessee for which the ld. AR of the assessee filed an application for condonation of delay with following prayers:
“Application for condonation of delay in filing Form 36 HON'BLE SIRS, I, Badri Narayan Choudhary, the above-named assessee-appellant would like to submit that:
1. 1. That the appellant is carrying on business of trading in commodity davis.
2. That the appellant-imposed penalty u/s 271B of the Income Tax Act vide order dated 21.06.2018 for failure to get the accounts audited as per provisions of section 44AB of the Act.
Badri Narayan Choudhary vs. ITO 3. That the appellant filed appeal before the CIT (A) against the impugned order and subsequently filed the written submission on portal. However, Worthy CIT(A)- NFAC on his own (without there being any application by the appellant) passed the order treating the appeal filed to be withdrawal as per 4 That the appeal against impugned order was statutorily required to be filed before worthy tribunal by 22.07.2022 and therefore there is delay of 956 days in filing form 36 which the appellant requests your honour to condone and allow admission of the appeal.
That the delay in filing Form 36 is solely due to the fact that on very same day i.e. 23.05.2022, two order were served on e-mail ID of the appellant, first for penalty u/s 271A & another for penalty u/s 271B, however the body of appellate order was verbatim same. The CIT(A) in both the orders dealt with penalty u/s 271A and therefore the appellant under Bonafide belief assume both the orders to be same and therefore only forwarded the copy of order relating to section 271A penalty and did not forwarded copy of order relating to penalty u/s 271B of the Act.
That the factum of impugned appellate order against penalty u/s 271B of the Income Tax Act came to the knowledge of the appellant only when the counsel as a routine exercise verified the IT portal on 07.01.2025 and on discovering deemed withdrawal of the appeal by the worthy CIT(A) as per provisions of DTVSV Act, swiftly filed the grievance on Samadhan Portal on 08.01.2025 about the gross negligence and request for restoration of appeal. The grievance was disposed of by the Faceless Centre on 31.01.2025 observing that appellant has option to approach next appellate authority.
That the delay in filing the form 36 is bona fide & unintentional and backed by reasonable cause. It is therefore, humbly prayed to kindly condone the delay of 956 days in filing Form 36 and allow admission of appeal and oblige.”
During the course of hearing, the ld. DR not objected to assessee’s application for condonation of delay and prayed that Court may decide the issue as deem fit in the interest of justice. materials available on record. The prayer by the assessee for condonation of delay of 948 days has merit as there was two order which were passed for one the assessee already filed VSVS and for the order under challenge the finding was same it was remained unattended. Thus, we concur with the submission of the assessee.
Thus the delay of 948 days in filing the appeal by the assessee is condoned in view of the decision of Hon’ble Supreme Court in the case of Collector, land Acquisition vs. Mst. Katiji and Others, 167 ITR 471 (SC) as the assessee is prevented by sufficient cause.
6. Succinctly, the fact as culled out from the records is that in this case there were two orders of penalty one related to 271A and other of 271B but the facts were same as decided by the ld. CIT(A). The assessee has already settled the dispute of levy of penalty as per provision of section 271A of the Act under the DTVSV Act 2020 and the assessee did not prefer the appeal against the levy of penalty u/s. 271B of the Act. On being aware of that fact the assessee preferred the present appeal and thereby the assessee challenged that order. As regards the levy of penalty the brief facts of the case is that in the case an order dated 21.06.2018 the ld.AO commodity transaction amounting to Rs. 7,33,80,90,800/- and thereby the assessee violated the provision of section 44AB of the Act and thereby liable for penalty u/s. 271B of the Act. As the gross receipt was Rs. 1,28,02,922/- the assessee was liable for penalty for Rs. 64,014/-.
7. Aggrieved from that order of levy of penalty as per provisions of section 271B of the Act, the same has preferred before the ld. CIT(A) while dealing with appeal of the assessee. Though the appeal related to section 271B of the Act penalty but while dealing with the finding part, ld. CIT(A) dealt with the appeal relates to the levy of penalty u/s 271A of the Act.
Since, the assessee was under confusion whether section 271B related penalty is decided or not. Since that appeal was disposed of with that observation the assessee challenged that finding of ld. CIT(A) before this Tribunal.
Ld. AR of the assessee in support of contention stated that once the assessee has accepted the fact that they have not maintained the proper books of accounts and not disputed of levy of penalty u/s 271A of the Act there cannot be a case for levy of penalty u/s. 271B of the Act.
We have heard the rival contentions and perused the material placed on record. The bench noted that in this case solitary issue raised by the assessee is that levy of penalty 271B of the Act. In this case it is also not disputed by the revenue that the assessee has already settled the dispute regarding levy of penalty u/s 271A of the Act wherein the levy of penalty was for maintenance of books of accounts. We find force in the argument of ld. AR of the assessee that once he accepted to have not maintained the books of account there cannot be a case to levy the penalty of not getting those books of accounts audited. Thus, once it is established that the assessee has not maintained the books of account how the same can be audited. Based on these observation we quash the levy of penalty u/s 271B of the Act and therefore, the appeal of the assessee is allowed.
In the result, the appeal of the assessee is allowed.
Order pronounced in the open court on 06/08/2025. Sd/- Sd/- ¼ Mk0 ,l- lhrky{eh ½ ¼ jkBksM deys'k t;UrHkkbZ ½ (Dr. S. Seethalakshmi) (Rathod Kamlesh Jayantbhai) U;kf;d lnL;@Judicial Member ys[kk lnL;@Accountant Member Badri Narayan Choudhary vs. ITO Tk;iqj@Jaipur fnukad@Dated:- 06/08/2025 *Ganesh Kumar, Sr. PS आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू 1. The Appellant- Badri Narayan Choudhary, Jaipur 2. izR;FkhZ@ The Respondent- ITO, Ward 4(1), Jaipur 3. vk;dj vk;qDr@ The ld CIT vk;dj vk;qDr¼vihy½@The ld CIT(A) 4. विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 5. xkMZ QkbZy@ Guard File (ITA No. 341/JP/2025) 6. vkns'kkuqlkj@ By order,
सहायक पंजीकार@Aेेज. त्महपेजतंत