DURG MESHAVAREE SAMITI,BHOPAL vs. NATIONAL FACELESS ASSESSMENT CENTRE, BHOPAL
Facts
The assessee filed an appeal against a penalty order for non-compliance with seven notices issued under Section 142(1) of the Income Tax Act, 1961. The penalty imposed was Rs. 70,000/-. The assessee admitted the default but contended that most of the notices were issued during the Covid period and should be considered as a single default.
Held
The Tribunal acknowledged the non-compliance with notices but considered the impact of the Covid period. While Section 272A(1)(d) mandates a penalty of Rs. 10,000/- for each default, the Tribunal reduced the total penalty to Rs. 10,000/- for all seven non-compliances, taking into account the circumstances and the Covid period.
Key Issues
Whether the penalty imposed for non-compliance with multiple Section 142(1) notices, some issued during the Covid period, should be aggregated or considered differently due to the prevailing circumstances.
Sections Cited
253, 272A(1)(d), 142(1), 246A, 144, 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI B.M. BIYANI & SHRI PARESH M JOSHI
आदेश / O R D E R
Per Paresh M Joshi, J.M:
This is an appeal filed by the assessee Under Section 253 of
the Income Tax Act, 1961 (hereinafter referred to as the “Act” for
sake of brevity) before this Tribunal. The assessee is aggrieved by
the order bearing No. ITBA/NFAC/S/250/2024-
25/1070216221(1) dated 08.11.2014 passed by the Ld. CIT(A)
u/s 250 of the Act which is hereinafter referred to as the
“Impugned order”. The relevant Assessment Year is 2018-19
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Durg Meshavaree Samiti ITA No. 30/Ind/2025 - A.Y. 2018-19 and the corresponding previous year period is from 01.04.2017
to 31.03.2018.
FACTUAL MATRIX
2.1 That as and by way of a penalty order made u/s
272A(1)(d) of the Act a penalty of Rs.70,000/- was imposed on
the assessee as the assessee had failed to comply with 7 notice(s)
issued to him on different dates from 02.12.2019 to 05.10.2020
u/s 142(1) of the Act. That the aforesaid penalty order bears No.
ITBA/PNL/F/272A(1)(d)/2021-22/106368783(1) and that same
is dated 13.10.2021 which is hereinafter referred to as the
“impugned penalty order”.
2.2 That the assessee being aggrieved by the aforesaid
“impugned penalty order” prefers first appeal u/s 246A of the
Act before the Ld. CIT(A) who by the “impugned order” has
dismissed the appeal of the assessee on the grounds and reasons
stated therein. The core ground being non-compliance of Section
142(1) notices numbering seven wherein there was absolute non -
appearance of the assessee before the Ld. A.O. Even in first
appeal the assessee remained non-compliant despite
opportunities by way of several notices. The “impugned penalty
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Durg Meshavaree Samiti ITA No. 30/Ind/2025 - A.Y. 2018-19 order” was upheld and first appeal of the assessee was
dismissed.
2.3 That the assessee being aggrieved by the “impugned order”
has preferred the instant second appeal before this Tribunal and
has raised following grounds of appeal in Form No.36 against the
“impugned order” which are as under:-
“1. That on the facts and in the circumstances of the case of the assessee the Learned Commissioner of Income Tax (National Faceless Appeal Centre), Delhi was not justified in confirming the penalty levied by the AO at Rs 70,000.00. 2. The assessee craves leave to add, alter amend or withdraw any ground of appeal on or before the time of hearing”.
Record of Hearing
3.1 The hearing in the matter took place before this Tribunal on
16.07.2025 when the Ld. AR for and on behalf of the assessee
appeared before us and interalia contended that the “impugned
penalty order” and so also the “impugned order” is illegal, bad
in law and not proper. It should be set aside by this Tribunal in
exercise of it’s appellate jurisdiction. It was submitted that the
penalty amount is in Rs.70,000/- in the aggregate. The default is
admitted. Few notice(s) were of Covid period. In all seven notices
u/s 142(1) of the Act were issued and served upon the assessee
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Durg Meshavaree Samiti ITA No. 30/Ind/2025 - A.Y. 2018-19 which could not be complied with at the material time and place.
Notice(s) are not on record and its contents are unknown. But all
were u/s 142(1) of the Act and nature of default is same i.e. non-
compliance to notice u/s 142(1) of the Act. Assessment order
(quantum) was passed u/s 144 of the Act. While admitting
default the Ld. AR prayed that instead of treating seven default
only one default should be counted as most of the notice(s)
pertains to Covid period. Per contra Ld. DR appearing for and on
behalf of the Revenue submitted that in so far as first three
notices are considered which are dated 02.12.2019, 30.01.2020
& 24.02.2020 is concerned it is a period prior to Covid whereas
notice(s) dated 15.07.2020, 14.08.2020, 31.08.2020 and
15.10.2020 are concerned notice(s) are during the Covid period.
Finally after some debate issue was left to the Tribunal to take
appropriate decision according to law. In rejoinder the Ld. AR has
placed reliance on the decisions of ITAT, Delhi Bench dated
06.05.2015 in case of Rekha Rani V/s DCIT-CC-Circle 8 in
ITA No.6131/Del/2013 and decision of ITAT, Pune Bench
dated 05.03.2025 in case of Archana Prashant Date V/s ITO
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Durg Meshavaree Samiti ITA No. 30/Ind/2025 - A.Y. 2018-19 Ward 11(1), Pune wherein penalty was confined to one default
only and not several.
Observations,findings & conclusions.
4.1 We now have to decide the legality, validity and the
proprietery of the “impugned order” basis records of the case
and rival contentions canvassed before us.
4.2 We have carefully perused the records of the case as
presented to this Tribunal by both Ld. AR & Ld. DR to determine
the legality, validity of the “impugned order” basis law and by
following due process .
4.3 We basis records of the case and so also after hearing and
upon examining the contentions are of the considered opinion
that the “impugned order” has imposed penalty of Rs.70,000/-
against 7 notice(s) issued u/s 142(1) of the Act for which there
was non-compliance on each notice(s). Simultaneously notice(s)
were during Covid period particularly first phase. While Section
272A(1)(d) of the Act under which penalty is imposed
contemplates penalty of Rs.10,000/- for each default or failure
and there is use of the word “shall” which makes it a mandatory
provision but nevertheless since it is not known as to what were
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Durg Meshavaree Samiti ITA No. 30/Ind/2025 - A.Y. 2018-19 the contents of notice(s) u/s 142(1) of the Act and keeping in view
Covid period we deem fit to impose penalty of Rs.10,000/- for all
7 notice(s) in respect of which there was non-compliances.
Accordingly we reduce penalty from Rs.70,000/- to Rs.10,000/-
in order to meet ends of justice.
4.4 In the premises set out herein above we set aside the
“impugned penalty order” and reduce the penalty which is
fixed i.e. Rs.10,000/- instead of Rs.70,000/- as imposed.
Order
5.1 In the result appeal of the assessee is partially allowed as
aforesaid.
5.2 Appeal of the assessee is partly allowed.
Order pronounced in open court on 21.07.2025.
Sd/- Sd/-
(B.M. BIYANI) (PARESH M JOSHI) ACCOUNTANT MEMBER JUDICIAL MEMBER
Indore िदनांक / Dated : 21/07/2025 Dev/Sr. PS
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Durg Meshavaree Samiti ITA No. 30/Ind/2025 - A.Y. 2018-19 Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File
By order COPY Senior Private Secretary Income Tax Appellate Tribunal Indore Bench, Indore
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