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Facts
The assessee filed an appeal before the CIT(A) challenging a penalty order, but it was dismissed due to a 41-day delay. The assessee explained the delay was due to the penalty order not being communicated via email and its late availability on the Income Tax portal.
Held
The Tribunal held that the assessee had provided sufficient cause for the delay in filing the appeal before the CIT(A). The delay was condoned, and the matter was restored to the CIT(A) for adjudication on merits.
Key Issues
Whether the delay in filing the appeal before the CIT(A) was sufficiently explained and should be condoned, and whether the penalty levied under section 271(1)(c) is sustainable.
Sections Cited
271(1)(c), 250, 271F
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Income Tax Appellate Tribunal, “D” BENCH, MUMBAI
Before: SHRI NARENDRA KUMAR BILLAIYA & SHRI SANDEEP SINGH KARHAIL
PER SANDEEP SINGH KARHAIL, J.M. The present appeal has been filed by the assessee challenging the impugned order dated 31/03/2024 passed under section 250 of the Income Tax Act, 1961 (“the Act”) by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [“learned CIT(A)”], which in turn arose from the penalty order dated 14/09/2022 passed under section 271(1)(c) of the Act, for the assessment year 2014-15.
2. In this appeal, the assessee has raised the following grounds: - “1. The Learned CIT(A)/NFAC erred in confirming order of Assessing Officer levying penalty u/s 271(1)(c) of Rs. 4,42,588/- by rejecting the Application for condonation of delay filed by the Appellant without appreciating that the 1 appellant had shown sufficient cause for delay and hence the order of CIT(A)/NFAC may be set-aside.
The Learned CIT(A)/NFAC erred in confirming order of Assessing Officer levying penalty u/s 271(1)(c) of Rs. 4,42,588/- for concealment of income of Rs. 21,11,601/- being the entire income disclosed in the return of income filed pursuant to notice u/s 148 on the ground that original return of income was not filed without appreciating that there is no concealment of income as there is no tax evasion as there is refund post assessment due to TDS being more than tax liability and no addition or disallowance is made in the assessment and the returned income is accepted and no tax is payable post assessment and hence the penalty of Rs. 4,42,588/- may be deleted.
The Learned CIT(A)/NFAC erred in confirming order of Assessing Officer levying penalty u/s 271(1)(c) of Rs. 4,42,588/- for concealment of income of Rs. 21,11,601/- being entire income disclosed in the return of income filed pursuant to notice u/s 148 on the ground that original return of income was not filed without appreciating that penalty u/s 271(1)(c) cannot be levied after reassessment w.r.to concealment in original return of income when original return of income is not filed by the Assessee at all as penalty is levied for failure to file return of income u/s 271F of the Act and hence the penalty of Rs. 4,42,588/- may be deleted.
The Appellant craves leave to add, delete or amend any of the grounds of appeal during the course of appellate proceedings.”
1. 3. We have considered the submissions of both sides and perused the material available on record. In the present case, at the outset, it is evident that the learned CIT(A) has passed the order dismissing the appeal filed by the assessee on the ground of delay without adjudicating the grounds raised by the assessee on merits against the levy of penalty under section 271(1)(c) of the Act. From the perusal of the impugned order, we find that in Form No. 35, the assessee requested for condonation of delay in filing the appeal and also explained the circumstances leading to a delay of 41 days in filing its appeal before the learned CIT(A). As per the assessee, the penalty order was not communicated to the assessee on its email address for communication, however, he received the demand notice for paying the penalty levied under section 271(1)(c) of the Act. It is further submitted that on inspection of the Income Tax Portal, it was found that the penalty order was not uploaded on the portal, therefore the assessee contacted his Chartered Accountant for further course of action. In the second week of November 2023, the assessee visited the Assessing Officer to enquire about the penalty order as it was not received via email noted on the Income Tax portal. As per the assessee, finally on 20/11/2023 on inspection of the Income Tax Portal again, the penalty order was accessible. Accordingly, the assessee consulted the tax counsel for further course of action, and on 25/01/2024 draft appeal was received by the assessee from his tax counsel, which was filed on 29/01/2024. Accordingly, the assessee submitted before the learned CIT(A) that in the aforesaid circumstances, the appeal was filed after a delay of 41 days.
4. As is evident from the impugned order, the learned CIT(A) did not agree with the submissions of the assessee and held that the assessee had failed to prove beyond any shadow of doubt that it had acted diligently and thus was guilty of negligence. Accordingly, the learned CIT(A) dismissed the appeal filed by the assessee on the ground of delay. During the hearing, no material was brought on record to controvert the submission of the assessee made before the learned CIT(A) seeking condonation of delay.
5. In view of the facts and circumstances of the present case, as noted above, we are of the considered view that the assessee has proved sufficient cause for not filing the appeal before the learned CIT(A) within the prescribed limitation period. Accordingly, we are of the view that the said delay should be condoned. Hence, we deem it appropriate to set aside the impugned order and restore the matter to the file of the learned CIT(A) for consideration on merits, as per law, Page | 3 after condoning the delay in filing the appeal by the assessee. We order accordingly. Needless to mention no order shall be passed without affording reasonable opportunity of hearing to the parties. The assessee is directed to appear before the learned CIT(A) on all the dates of hearing as may be fixed without any default. As the matter is being restored to the file of the learned CIT(A) for adjudication on merits, the other grievances raised by the assessee in the present appeal do not call for adjudication at this stage. Accordingly, grounds raised by the assessee are allowed for statistical purposes.
In the result, the appeal by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 27/08/2024