N.D.G. ESTATES PVT. LTD.,KOLKATA vs. ITO, WARD - 7(1), KOLKATA, KOLKATA

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ITA 1614/KOL/2017Status: DisposedITAT Kolkata05 September 2018AY 2012-133 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal upheld the penalty for non-compliance with the Section 143(2) notice. However, it cancelled the penalty for non-compliance with the Section 142(1) notice, finding that the omission of 'Jatindra Mohan Avenue' from the address rendered the notice invalid and undisputed by the revenue.

What were the facts?

The assessee was levied penalty under Section 271(1)(b) for non-compliance with notices issued under Sections 143(2) and 142(1). The assessee agreed that the notice under Section 143(2) was served, but contested the notice under Section 142(1) due to an incorrect address on the notice.

What were the issues?

Whether penalty under Section 271(1)(b) is leviable for non-compliance with a notice issued with an incomplete address, and whether the penalty for non-compliance with Section 143(2) notice is sustainable.

Which sections of the Income-tax Act were involved?

Section 271(1)(b),Section 143(2),Section 142(1),Section 144

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “D” BENCH : KOLKATA

Before: Hon’ble Shri M.Balaganesh, AM & Hon’ble Shri S.S.Viswanethra Ravi, JM]

Hearing: 23.08.2018Pronounced: 05.09.2018

Per M.Balaganesh, AM

1.

This appeal is directed against the order passed by the Learned Commissioner of Income Tax(Appeals)-3, Kolkata [in short the ld CIT(A)] in Appeal No.1955/CIT(A)-3/Kol/DCIT, C-7(2)/Kol/15-16 dated 31.05.2017 against the order passed by the ITO Ward 7(1), Kolkata [ in short the ld AO] and levying penalty under section 271(1)(b) of the Act vide order dated 28.08.2015 levying penalty of Rs. 20,000/- for the assessment year 2012-13.

2.

The brief facts of this appeal are that the penalty u/s 271(1)(b) was levied by the Ld. A.O. for non-compliance of statutory notices issued by the Ld. A.O. u/s 143(2) and 142(1) of the Act. The penalty of Rs. 10,000/- was levied for each such default of the assessee. During the course of hearing, the learned AR before us agreed that notice u/s 143(2) was duly served on the assessee and hence penalty u/s 271(1)(b) levied thereon is not pressed by him. Accordingly,

Assessment Year: 2012-13 NDG Estates Pvt. Ltd. the penalty levied for default of non-appearance for notice u/s 143(2) of the Act in the sum of Rs. 10,000/- is hereby upheld.

3.

With regard to the issue of notice u/s 142(1) of the Act, since there was no compliance by the assessee, the learned A.O. levied penalty u/s 271(1)(b) of the Act in the sum of Rs. 10,000/-. The assessment was completed by the learned A.O. u/s 144 of the Act.

4.

We have heard rival submissions. The learned AR argued before us that the notice u/s 142(1) of the Act was never received by the assessee and prayed for cancellation of penalty levied thereon. He argued that from the perusal of the records, it was found that in the notice u/s 142(1) of the Act, the complete address of the assessee was not mentioned by the learned A.O. He stated that the complete address of the assessee is as under:

“11B, Jatindra Mohan Avenue, Beadon Street, Kolkata – 700 006.” Whereas the address mentioned in the notice 142(1) was as under:

“11B, Beadon Street, Kolkata – 700 006.” Because of this mistake, the notice u/s 142(1) of the Act could not be complied with by the assessee which eventually resulted in framing of assessment u/s 144 of the Act. This fact was also brought to the notice of the Ld. CIT(A) in the penalty appeal u/s 271(1)(b). However, the Ld. CIT(A) did not heed to the contention of the assessee. We find lot of force in this argument of the learned AR in as much as the correct address of the assessee as per the assessment order, appellate order and Form No. 36 was filed before it. Since the crucial words ‘Jatindra Mohan Avenue’ was not mentioned in the notice issued u/s 142(1) of the Act by the learned A.O., which remained undisputed before us by Assessment Year: 2012-13 NDG Estates Pvt. Ltd. the revenue, we deem that it is not a fit case for levy of penalty u/s 271(1)(b) of the Act for non-compliance of notice u/s 142(1) of the Act.

5.

In the result, the appeal of the assessee is partly allowed.

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