HARSHADA RAJENDRA SHAH,UNITED STATES vs. ITO WARD 20(1)(5) MUMBAI, MUMBAI
Facts
The assessee, a non-resident Indian settled in the USA for over 40 years, did not comply with notices issued under section 142(1) during the assessment proceedings. The Assessing Officer levied a penalty of Rs. 10,000/- for non-compliance, which was sustained by the CIT(A). The assessee explained that she was out of India and undergoing cancer treatment during the assessment period.
Held
The Tribunal considered the assessee's explanation that she was a non-resident, undergoing cancer treatment in the USA, and therefore, it was not possible for her to comply with the notices. It was held that there was a bonafide reason for non-compliance.
Key Issues
Whether the penalty levied for non-compliance to notices issued under section 142(1) is justified when the assessee had a bonafide reason for not complying due to being a non-resident undergoing medical treatment.
Sections Cited
272A(1)(d), 142(1), 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “E” BENCH, MUMBAI
आदेश / O R D E R Per Amarjit Singh (AM): The solitary ground of appeal is directed against the order of the ld. CIT(A) passed u/s 250 of the Act dated 16.10.2023 for sustaining the penalty of Rs.10,000/- levied by the assessing officer u/s 272A(1)(d) for not making compliance to the notices issued during the course of assessment proceedings. 2. In the penalty order u/s 272A(1)(d) passed on 27.09.2019, the assessing officer stated that assessee has not made compliance to the notices issued u/s 142(1) of the Act requiring the assessee to prepare true and correct return of income for the A.Y. 2017-18. Consequently, the AO levied penalty of Rs.10,000/- u/s 271A(1)(d) of the Act. The ld. CIT(A) has sustained the penalty for not making compliance.
P a g e | 2 ITA No.4299/Mum/2023 Harshada Rejendra Shah Vs. ITO,Ward 20(1)(5) 3. Heard the ld. D.R and perused the material on record. The assessee has explained in the form 35 filed before the ld. CIT(A) that she is a non-resident Indian and settled in U.S. for over last 40 years and having no taxable income in India. She also explained that through the period of assessment proceeding she was out of India in the USA and during the same period she was also diagnosed with cancer for which she had undergone treatment in the USA. She explained in the statement of facts filed before the ld. CIT(A) that because of aforesaid circumstances it was not possible for her to either file or appear before the assessing officer to explain her case. The same facts are in the appeal paper filed before us. After considering the aforesaid facts and circumstances it appear that there is a bonafide reason for not making compliance to the notices issued under section 142(1) before the AO since the assessee was above 70 years old a non-resident settled in USA for the last 40 years. Further during the same period she was undergoing treatment of cancer at U.S.A. Therefore, we delete the penalty of Rs.10,000/- levied u/s 271A(1)(d). Accordingly, the appeal of the assessee is allowed. 4. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 31.05.2024 Sd/- Sd/- (Sandeep Singh Karhail) (Amarjit Singh) Judicial Member Accountant Member Place: Mumbai Date 31.05.2024 Rohit: PS
P a g e | 3 ITA No.4299/Mum/2023 Harshada Rejendra Shah Vs. ITO,Ward 20(1)(5)
आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to : 1. अपीलाथी / The Appellant 2. प्रत्यथी / The Respondent. 3. आयकर आयुक्त / CIT 4. विभागीय प्रविविवि, आयकर अपीलीय अविकरण DR, ITAT, Mumbai 5. गार्ड फाईल / Guard file. सत्यावपि प्रवि //True Copy// आदेशानुसार/ BY ORDER, उि/सहायक िंजीकार (Dy./Asstt. Registrar) आयकर अिीिीय अतिकरण/ ITAT, Bench, Mumbai.
