NILESH RAKESHKUMAR GUPTA,MUMBAI vs. ITO WD 14(3)(2), MUMBAI

The only common ground raised

in the present appeals is with respect to confirming the penalty levied under section 271(1)(b) of the Income Tax Act, 1961 (hereinafter the Act). During hearing, the learned counsel for the assessee Shri Vimal Punamiya claimed that the impugned issue is covered in the case of assessee itself vide order dated 29/09/2014 (ITA Nos. 371 to 374/MUM/2013) and in the case of Hema Rakeshkumar Gupta (ITA Nos. 381 to 385/MUM/2013 order dated 27/08/2014, from the Tribunal. This factual matrix was not controverted by ld.DR Shri Neil Philiph. 2.1. We have considered the rival submissions and perused the material available on record. In view of the 3. Mohit Rakeshkumar Gupta & Nilesh Rakeshkumar Gupta to 380/Mum/2013 above, we are reproducing hereunder the relevant portion from the order of the Tribunal dated 29/09/2014 for ready reference and analysis.

It is pertinent to note that the AO had already issued a notice earlier u/s 143(2) of the Act, i.e., the said notice was dated 24.9.2010. In the case of Mrs. Hema Rakesh Kumar M Gupta (supra) also, the assessing officer had issued two notices u/s 143(2) of the Act and levied penalty u/s 271 (1 )(b) of the Act in respect of the second notice, to which the assessee therein did not respond. The Co-ordinate Bench of the Tribunal, in the case of Mrs. Hema Rakeshkumar M Gupta (supra), has appreciated the factual position discussed above. and expressed the view that there was no necessity for issuing a fresh notice dated 6.10.2010 u/s 143(2) of the Act second time, when the effect of first notice was still live requiring compliance by the assessee. Accordingly, the Tribunal has expressed the view that there is no case for levying penalty for non-compliance of notice dated 6.10.2010 issued u/s 143(2) of the Act, apparently for the reason that the said notice is superfluous in nature. Since the facts prevailing in the instant case are identical in nature, we are inclined to adopt the same that was expressed by the Co-ordinate bench in the case of Smt. Hema RakeshKumar M (supra).

In the case of Srnt. Herna RakeshKurnar M Gupta (supra) also, the Assessing Officer had issued the notice u/s 142(1) on 11.11.2010. With regard to the said notice, the Tribunal has noted that the Assessee had partially complied with the same by filing a letter dated 19.11.2010 4 Mohit Rakeshkumar Gupta & Nilesh Rakeshkumar Gupta to 380/Mum/2013 through "Tapal", though it was filed belatedly on 25.11.2010. The Tribunal further noticed that the assessee had sought time in the above said letter and the assessing officer also had granted time in response to the same. Accordingly, the Tribunal expressed the view that there was substantial compliance by the Assessee to the notice dated 11.11.2010 issued by the AO. Accordingly, the Tribunal expressed the view that the Assessee is saved of penalty by a reasonable cause in terms of Section 273B of the Act. In the instant case also, the assessee herein has filed a letter dated 19/11/2010 through "Tapal", though it was filed belatedly on 25.11.2010. The Tribunal further noticed that the assessee had sought further time in the above letter and the assessing officer has granted time in response thereto. Hence, as per the view taken by the co ordinate bench, there is substantial compliance to the notice issued by the AO on 11.11.2010. Hence, consistent with the view taken by the co-ordinate bench in the case of Smt. Hema RakeshKumar M Gupta (supra), we also hold that there was no necessity to levy penalty u/s 271 (1 )(b) of the Act, since there was a reasonable cause in terms of sec. 273B of the Act.

The facts prevailing in all the years are identical in nature and hence, for the foregoing reasons, we set aside the order of Id. CIT(A) in all the years under consideration and direct the AO to delete the penalty levied u/s 271 (1)(b) of the Act in all the years. 9. In the result, all the appeals of the assessee are allowed.”