PRAVEEN DAGA,GUWAHATI vs. ITO WARD 6(2), JAIPUR, JAIPUR

2. The ld. CIT(A) has grossly erred in law as well as on the facts of the case in confirming the penalty of Rs. 10,000/- u/s 271(1)(b)

The ld. AR of the assessee has submitted that the assessee is an individual and shifted from Jaipur to Guwahati (Assam). The assessee has filed his return of income with the ITO, Ward 3(3), Guwahati on 13/01/2012. A copy of the return of income is placed at page No. 1 of the paper book and thus the ld. AR has submitted that the assessee filed return of income which was not considered by the A.O. while issuing the notice U/s 148 of the Act which is issued on the presumption that the assessee has not filed any return of income. The ld. AR has further submitted that since the assessee has shifted from Jaipur to Guwahati and filed his return of income with the ITO, Ward 3(3), Guwahati, therefore, the assessee could not respond to the notices issued by the ITO, Ward 6(2), Jaipur. The ld. AR has thus submitted that the assessee has not received the alleged notices issued by the A.O. as he was not in the Jaipur and already shifted to Guwahati and hence the assessment was completed U/s 144 r.w.s. 147 of the Income Tax Act, 1961 (in short, the Act). Since the notices were not served upon the assessee, therefore, the penalty levied by the A.O. U/s 271(1)(b) of the Act is not 3 ITA 83/JP/2021 Praveen Daga Vs ITO sustainable and justified. He has thus, pleaded that the assessee has explained a reasonable and bonafide explanation for non-compliance of the alleged notices issued by the A.O. to the assessee.

On the other hand, the ld. DR has submitted that the assessee has not filed his return of income with the jurisdictional ITO but unilaterally chose to file the return with the ITO, Ward 3(3), Guwahati who has no jurisdiction to assess the income of the assessee. Thus, wrong filing of return of income cannot be a ground for non-compliance of notices issued by the A.O. She has relied upon the orders of the authorities below and submitted that it is clear case of non-compliance of notice issued by the A.O. and therefore, the penalty levied by the A.O. U/s 271(1)(b) of the Act is justified.

I have considered the rival submissions as well as the relevant material on record. The A.O. issued notice U/s 148 of the Act on 30/03/2018 at P No. 330, Vasundhara Colony, Tonk Road, Jaipur i.e. the address of the assessee. Thereafter the A.O. issued notice U/s 142(1) of the Act to the Guwahati address as well as Jaipur address of the assessee. Thus, it is clear that subsequently, the A.O. came to know that the assessee has shifted from Jaipur to Guwahati. It is also not disputed that the assessee filed his return of income on 13/01/2012 with ITO, 4 ITA 83/JP/2021 Praveen Daga Vs ITO Ward 3(3), Guwahati, though the said return was not filed with the A.O. having jurisdiction of the assessee but since the assessee has shifted from Jaipur to Guwahati and also filed the return of income, therefore, it amounts to a bonafide and reasonable explanation for non-compliance of the notices issued by the A.O. U/s 142(1) of the Act for which the A.O. has levied the penalty of Rs. 10,000/- U/s 271(1)(b) of the Act. By considering the facts and circumstances of the case when the assessee has shifted from Jaipur to Guwahati and this fact is also substantiated by filing the return of income with ITO, Ward 3(3), Guwahati, then the assessee has proved that there was a reasonable cause for the failure and non-compliance of the notice U/s 142(1) of the Act as provided in Section 273B of the Act. Hence, the penalty levied U/s 271(1)(b) of the Act is deleted.

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