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Facts
The assessee, a 56-year-old lady, failed to file her income tax return for AY 2016-17. The case was reopened, and after she filed a return, she failed to comply with subsequent notices due to medical reasons and technical illiteracy. A penalty was imposed for non-compliance.
Held
The Tribunal acknowledged the assessee's medical condition and technical limitations, finding the non-compliance to be technical and venial. The penalty was reduced from Rs. 30,000 to Rs. 10,000, with the balance amount to be deleted.
Key Issues
Whether the penalty imposed under Section 271(1)(b) for non-compliance with notices is justified considering the assessee's medical condition and technical illiteracy.
Sections Cited
250, 271(1)(b), 148, 143(2), 142(1)
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Income Tax Appellate Tribunal, COCHIN BENCH
Before: SHRI INTURI RAMA RAO, AM & SHRI ANIKESH BANERJEE, JM
O R D E R Per: Anikesh Banerjee, JM The instant appeal of the assessee was filed against the order of the Learned National Faceless Appeal Centre, Delhi [for brevity, ‘Ld.CIT(A)’] passed under section 250 of the Income-tax Act, 1961 (in short, the Act’) for Assessment Year 2016-17, date of order 24/06/2025. The impugned order emanated from the order of the Assessment Unit, Income Tax Department (in short, ‘Ld.AO’) passed under section 271(1)(b) of the Act, date of order 22/08/2024.
Bader Sultana Kakad 2. Brief fact of the case is that is a Muslim lady aged 56 years have not filed returns for the AY 2016-17 relevant to the PY 2015- 16. The Ld. Jurisdictional AO (JAO), Ward 1, Palakkad, in consequence of the information relating to sale of immoveable property for Rs. 83,15,000/- and also based on the cash deposits of Rs. 13,50,000/- with Union Bank of India and Interest of Rs. 4,66,099/- from Andhra Bank issued Notice u/s 148Ä(b) dated 19.02.2023. The date of compliance was10.03.2023. The assessee in response to the above notice, filed an objection on 10.03.2023. However, the JAO without making any further enquiries passed order u/s 148A on 14.03.2023.Consequently, the JAO issued a notice u/s 148 on 14.03.2023 itself directing the assessee to file a return of income within 30 days. After the return u/s 148 was filed by the assessee, the Ld. AO issued notices u/s 143(2) on 20/09/2023 and 142(1) on 03/10/2023 & 04/12/2023 but the assessee being an elderly woman had medical issues and was under treatment because of which her travel was restricted. The same was submitted to the Ld. AO in response to one of the notices. Since the assessee couldn't responds to the notices, the Ld. AO passed the penalty order u/s 271 (1)(b) of the Act for non-compliance of three notices aggregate amount of penalty of Rs. 30,000/-. During the penalty proceeding the assessee made details compliance on dated 04/05/2024in response to notice of the Ld. AO dated 02/05/2024. But the penalty is imposed by the Ld. AO by rejecting the submission of the assessee. Aggrieved assessee filed an appeal before the Ld. CIT(A).
The Ld. AR argued that the assessee was unaware of the notices due to her due to lack of technical skills and the assessee was medically unfit tocomply the said notices issued by the Ld. AO. The assertion of medical issues restricting her travel was duly mentioned by the assessee before theLd. AO in letter dated 04/05/2024. Further he argued that the assessee is elderly lady andtech-illiterate and was unable to access the email where the notices are delivered.But no medical certificate or other evidence is filed by the Ld. AR in support of his argument. He prayed for deletion of penalty imposed by the Ld. AO.
The Ld. DR argued that the reasons cited by theLd. AR is not at all accepted. The Ld. AO rightly imposed the penalty for the noncompliance of notices. He stands in favour of the orders of revenue authorities.
We have heard the rival submissions and carefully considered the materials available on record. The facts reveal that the assessee, a 56-year-old Muslim lady, did not file her return of income for the assessment year 2016–17. The case was reopened under section 148 of the Act on the basis of information regarding the sale of immovable property, cash deposits, and interest income. Although the assessee eventually filed a return in response to the notice under Bader Sultana Kakad section 148 of the Act, she could not comply with the subsequent notices issued under sections 143(2) and 142(1) due to medical reasons and limited technical knowledge.It is noted that the assessee made do compliance on 04.05.2024 during the penalty proceedings in response to the notice of the Ld. AO dated 02.05.2024. Thus, there was no deliberate or willful non-compliance on her part. Considering her age, medical condition, and the fact that she ultimately participated in the proceedings, we find that the default was only technical and venial in nature.In view of these facts and the principle of proportionality, we are of the considered view that the penalty imposed under section 271(1)(b) of the Act deserves to be restricted to Rs.10,000/- instead of Rs.30,000/-.Accordingly, the penalty is sustained to the extent of Rs.10,000/- and the balance amount is directed to be deleted.
Order pronounced in the open court on 29th October, 2025.