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Facts
The assessee, a cooperative credit society, filed a nil return claiming a deduction under Section 80P. The Assessing Officer disallowed a portion of the 80P claim and levied a penalty of Rs. 49,152/- under Section 270A for misreporting of income. The CIT(A) subsequently dismissed the assessee's appeal ex-parte due to non-compliance with notices.
Held
The Tribunal found that the CIT(A) had passed an ex-parte order without ensuring adequate opportunity of hearing. Citing principles of natural justice, the Tribunal set aside the CIT(A)'s order and remitted the issue of penalty levy back to the CIT(A) for fresh adjudication, with directions to provide the assessee a proper chance to present its case.
Key Issues
Whether the CIT(A)'s ex-parte dismissal of the appeal regarding penalty under Section 270A was justified due to non-compliance, and whether the penalty levied under Section 270A for misreporting of income was valid.
Sections Cited
270A, 250, 80P, 143(2), 142(1), 143(3), 143(3A), 143(3B), Chapter VIA
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “SMC” BENCH PANAJI
Before: SHRI PAVAN KUMAR GADALEShri.Pandmavati Minority
सुनवाई की तारीख/Date of Hearing 17.09.2025 घोषणा की तारीख/Date of 18.09.2025 Pronouncement ORDER
PER PAVAN KUMAR GADALE, JM:
The appeal is filed by the assesse against the order of National Faceless Appeal Centre (NFAC) Delhi / CIT(A) passed u/sec 270A and u/sec 250 of the Act. The assesse has raised the grounds of appeal
challenging the ex-parte order of the CIT(A) sustaining the levy of penalty u/sec270A of the Act.
2. The brief facts of the case are that, the assessee is a cooperative credit society and has filed the return of Shri Pandmavati Minority Mahila Multi Cooperative Society Limited. income on 5-09-2018 for the A.Y 2018-19 disclosing a total income of Rs. Nil after claiming deduction of Rs.25,24,281/- u/sec 80P of the Act. Subsequently the case was selected for limited scrutiny under E-assessment scheme to verify – investments/advances/loans and deduction from total income under chapter VIA. The A.O issued notice u/sec 143(2) and u/sec 142(1) of the Act calling for details and after due compliance. The A.O considering the details and evidences has disallowed the claim of deduction u/sec80P of the Act to the extent of Rs.88,770/- and assessed the total income of Rs.88,770/- and passed the order u/sec143(3)r.w.s143(3A)&143(3B) of the Act dated 18.03.2021.
3. Subsequently, the A.O. has initiated penalty proceedings u/sec 270A of the Act for misreporting of income and the A.O has issued show cause notice. The assesse has complied with the information and explanations. Whereas, the AO was not satisfied with the submissions and levied a penalty of Rs.49,152/- and passed the order u/s 270A of the Act dated 26-02-2024.
Aggrieved by the penalty order, the assesse has filed an appeal before the CIT(A), whereas the CIT(A) has considered the grounds of appeal, statement of facts and Shri Pandmavati Minority Mahila Multi Cooperative Society Limited. findings of the penalty proceedings and has issued notices of hearing and since there was no compliance by the assesse to notices. Therefore the CIT(A) considering the information on record has dismissed the appeal. Aggrieved by the order of the CIT(A), the assessee has filed an appeal before the Hon'ble Tribunal.
Heard the Ld DR submissions and perused the material on record. Prima-facie the CIT(A) has passed the order considering the fact that there is no compliance nor appearance in spite of providing adequate opportunity of hearing and the notices were issued. Therefore, the CIT(A) was of the opinion that the assesse is not interested in prosecuting the appeal and passed the ex parte order. The CIT(A) has issued only two notices of hearing on i.e 25.04.2025 & 20.05.2025 referred at Para 7 of the order and there was no response and thus the Ld.CIT(A) came to a conclusion that the assesse is not interested and decided the appeal based on the information available on record. Whereas the assesse has raised grounds of appeal challenging the penalty levied by the A.O and there could be various reasons for non appearance which cannot be overruled. Therefore, considering the facts, circumstances and principles of natural justice, shall provide with one more opportunity of hearing to the assessee to substantiate the case with evidences and information. Accordingly, set aside the order of the CIT(A) and remit the disputed issue of levy of penalty to the file of the Shri Pandmavati Minority Mahila Multi Cooperative Society Limited. CIT(A) to adjudicate afresh and the assesse should be provided adequate opportunity of hearing and shall cooperate in submitting the information for early disposal of the Appeal. And the grounds of appeal
of the assesse are allowed for statistical purpose.
6. In the result, the appeal filed by assessee is allowed for statistical purposes. Order pronounced in the open court on 18.09.2025.