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Facts
The assessee failed to comply with notices issued by the Assessing Officer during assessment proceedings for AY 2017-18, leading to an ex-parte assessment order and a penalty. The assessee was studying in the USA during this period, and his father, tasked with attending proceedings, was occupied with other legal matters. The assessee challenged the penalty order after his first appeal proved unsuccessful.
Held
The Tribunal acknowledged that the assessee was in the USA for studies when notices were issued and that his father's inability to attend proceedings due to prior commitments resulted in non-compliance. The Tribunal also noted that the penalty was levied for non-compliance with statutory notices.
Key Issues
Whether the penalty imposed for non-compliance with notices is justified, considering the assessee was abroad and his representative was unable to attend proceedings due to unavoidable reasons.
Sections Cited
250, 144, 69A, 115BBE, 272A(i)(d), 142(1), 153(3), 270A, 271AAC(1)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, MUMBAI BENCH “A”, MUMBAI
Before: SHRI NARENDER KUMAR CHOUDHRY & SHRI JAGADISH
O R D E R
Per :Narender Kumar Choudhry, Judicial Member:
This appeal has been preferred by the Assessee against the order dated 13.10.2025 impugned herein, passed by the National Faceless Appeal Centre (NFAC)/Ld. Commissioner of Income Tax (Appeals) (in short Ld. Commissioner) u/s 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y. 2017-18.
In this case, during the Assessment proceedingsinitiated on the basis of scrutiny, various notices dated 21.09.2018, 17.06.2019 & 22.06.2019 were issued to the Assessee by the Assessing Officer. Somehow, the Assessee failed to comply with the notices issued and therefore the Assessing Officer ultimately passed the Assessment Order dated 29.06.2019 u/s 144 of the Act, making addition of Rs.14,81,000/- u/s. 69A r.w.s 115BBE of the Act.
The Assessing Officer also initiated the penalty proceedings u/s 272A(i)(d) of the Act for not complying with the aforesaid statutory notices and ultimately vide penalty order dated 18.12.2019 u/s 272A(1)(d) of the Act, levied the penalty of Rs.10,000/- for non- compliance of the notice u/s 142(1) of the Act, dated 17.06.2019. Thus, the Assessee being aggrieved has challenged the decision of the Assessing Officer in levying the penalty of Rs.10,000/- vide penalty order dated 18.12.2019.
Though the Assessee preferred First Appeal against the penalty order dated 18.12.2019 but of no avail and thus the Assessee being aggrieved has preferred instant Appeal.
We have heard the parties and considered the rival submissions of the parties and perused the relevant material on record. Admittedly in the quantum Appeal, the Ld. Commissioner vide impugned order dated 10.03.2025 ultimately set-aside the Assessment Order with a direction to the Assessing Officer to make afresh Assessment in accordance with rules and timelines prescribed u/s 153(3) of the Act. Further the Ld. Commissioner vide orderseven dated 17.09.2025 u/s 270A and 271AAC(1) of the Act, also dropped the penalty initiated under the aforesaid provisions/sections.
Further, it is a fact that the Assessee was studying in USA during the time period, when statutory notices were issued and therefore he entrusted responsibility to his father to attend the Assessment proceedings. However, during the end of June, 2019, the Assessee’s father was extremely tied up in arguing tax matter on behalf of the Revenue Department at Hon’ble Bombay High Court, which resulted into non-compliance before the Assessing Officer and/or non-representation of the Assessee during the Assessment proceedings.
Though, the Ld. DR supported the decision of the Authorities below in making and sustaining the penalty under consideration however, not refuted the factual aspect qua visit of the Assessee at USA during the period, when statutory notices was issued by the Assessing Officer.
We have given thoughtful consideration to the peculiar facts and circumstances of the case, specifically the claim of the Assessee that during the period of notices issued as involved, he was not in India, as he went to USA for studying purposes/career growth, which resulted into non-compliance of the notices issued by the Assessing Officer. Somehow, now the Assessee is returned back to India and pursuing his legal proceedings in proper and effective manner and undertakes not to commit any mistake in future. Thus, we deem it appropriate to delete the penalty under consideration by allowing appeal of the Assessee. Resultantly, the penalty is deleted.
In the result Assessee’s Appeal is allowed.
Order pronounced in the open court on 16.02.2026.