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Income Tax Appellate Tribunal, IN THE INCOME TAX APPELLATE TRIBUNAL
Before: SHRI G.D. AGRAWAL & AND & MS. SUCHITRA KAMBLE
PER G.D. AGRAWAL, PER G.D. AGRAWAL, PRESIDENT PER G.D. AGRAWAL, PER G.D. AGRAWAL, PRESIDENT PRESIDENT :- PRESIDENT All these appeals by the assessee are against the levy of penalty amounting to `20,000/- under Section 271(1)(b) of the Income-tax Act, 1961.
The assessee has raised as many as five grounds. However, they are all against the levy of penalty u/s 271(1)(b) of the Act amounting to `20,000/-.
At the time of hearing before us, it is stated by the learned counsel that the Assessing Officer issued notice u/s 271(1)(b) dated 24th June, 2013. However, in the penalty notice, there is no mention in respect of any default committed by the assessee. Thus, the levy of penalty on the basis of such penalty notice is void and bad in law. He also referred to the penalty order and pointed out that even in the penalty order, the Assessing Officer has not mentioned which particular notice was not attended by the assessee. There is only a general remark that different notices issued by his office from time to time remained uncomplied with. That in the penalty proceedings, unless the default is specified, the assessee cannot be penalized in respect of such alleged default. He also stated that the issue is squarely covered in favour of the assessee by the decision of ITAT in other appeals of the same group i.e., in the case of M.M. Buildcon Pvt.Ltd. Vs. DCIT vide to 4521/Del/2015.
Learned Senior DR, on the other hand, relied upon the orders of authorities below and he stated that the assessee is a habitual defaulter and has made no compliance during the assessment proceedings which resulted in the assessment u/s 144. Therefore, the levy of penalty u/s 271(1)(b) is fully justified. He also stated that the meager penalty of `20,000/- is levied which should be sustained.
We have carefully considered the submissions of both the sides and perused the material placed before us. The copy of the penalty notice is placed at page 6 of the assessee’s paper book, the relevant portion of which reads as under :-
“Please refer to penalty proceedings referred to above. In this connection, you are hereby given an opportunity to file your explanation alongwith evidence. Your case is fixed for hearing on 04/07/2013.
Please note in case of non-compliance, the said penalty proceedings will be decided on merits.”
From the above, it is evident that the Assessing Officer has not specified the default i.e., the specific notice which, according to him, remained uncomplied with by the assessee. The relevant portion of the penalty order reads as under :-
“2. During the course of assessment proceedings the assessee failed to attend the proceedings as and when it was required through different notices issued by this office from time to time. Whatever the submission filed by the assessee were filed in DAK and the assessee preferred in not attending the assessment proceedings before the AO. Accordingly, proceedings u/s 271(1)(b) of the Act were initiated while finalizing the assessment on 21.03.2013. As per the note sheet failed to attend the proceedings as was required by this office on 30.11.2012 & 28.12.2012, and whatever remaining compliance was made by the assessee was made through DAK.”
Thus, even in the penalty order, the observation of the Assessing Officer is general in nature. In our opinion, before the penalty can be levied upon the assessee u/s 271(1)(b), it is essential on the part of the Assessing Officer to specify the particular notice which, according to the Assessing Officer, remained uncomplied with. The Assessing Officer should clearly mention the date of issue of notice, the date of service of the notice and the date on which or by which the assessee was supposed to comply with the said notice. In the case under consideration before us, no such particulars are given. On these facts, we are of the opinion that the penalty order is vague and the same cannot be sustained. We also observe that on merits, under similar circumstances, the ITAT has already cancelled the penalty in the case of M.M. Buildcon Pvt.Ltd. in to 4521/Del/2015, order dated 6th November, 2017. In view of the above, we do not find it a fit case for confirming the penalty levied u/s 271(1)(b) of the Act. The same is cancelled in the case of all the above years.
In the result, all the appeals of the assessee are allowed. Decision pronounced in the open Court on 26.12.2017.