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Facts
The assessee, a senior citizen and farmer, challenged a penalty of Rs. 10,000 imposed under Section 271(1)(b) for non-compliance with notices during re-assessment proceedings. He contended that he did not receive the Section 142(1) notice, citing his residence in a village with poor postal services and his health condition.
Held
The Tribunal found reasonable cause for the assessee's default, acknowledging his humble background and consistent claim of non-receipt of the notice. Consequently, the penalty of Rs. 10,000 imposed under Section 271(1)(b) was deleted.
Key Issues
Whether the assessee had reasonable cause for not complying with notices under Section 142(1), thereby justifying the deletion of penalty imposed under Section 271(1)(b) of the Income Tax Act, 1961.
Sections Cited
Section 271(1)(b), Section 142(1)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH “H” DELHI
Before: SHRI PRADIP KUMAR KEDIA & SHRI SUDHIR PAREEK
PER PRADIP KUMAR KEDIA - A.M.: The captioned appeal has been filed by the assessee against the order of the Commissioner of Income Tax (Appeals)-National Faceless Appeal Centre (NFAC), Delhi [‘CIT(A)’ in short] dated 06.05.2021 arising from the penalty order dated 22.04.2019 passed by the Assessing Officer (AO) under Section 271(1)(b) of the Income Tax Act, 1961 (the Act) concerning A.Y. 2011-12.
As per the grounds of appeal, the assessee has challenged the imposition of penalty of Rs.10,000/- under Section 271(1)(b) of the Act for default in compliance of the notices issued in the course of re-assessment proceedings.
It is the contention of the assessee that he is a senior citizen and patient of uncontrolled diabetes. He has not received any notice under Section 142(1) and he is residing in village where the postal services are not very effective. The assessee received assessment order and the notice under Section 271(1)(b) for the first time on 23.02.2019 through an unknown villager.
Keeping in mind the humble background of the assessee who claims to be a poor farmer and surviving on agriculture income, coupled with the fact that assessee all along has claimed that he has not received notice under Section 142(1) of the Act, we find some force in the plea of the assessee.
To our mind, reasonable cause exists for default committed in appearance before the AO. Hence, penalty imposed under Section 271(1)(b) stands deleted having regard to the totality of facts available in the case.
In the result, the appeal of the assessee is allowed.
Order pronounced in the open Court on 27 August, 2024.