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Income Tax Appellate Tribunal, “A” BENCH KOLKATA
Before: SHRI SANJAY GARG & SHRI RAKESH MISHRA
Present for: Appellant by : B.B. Payra, Advocate Respondent by : Raja Sengupta, Addl. CIT, Sr. DR Date of Hearing : 04.07.2024 Date of Pronouncement : 26.08.2024 O R D E R
PER RAKESH MISHRA, ACCOUNTANT MEMBER:
This appeal filed by the assessee is against the order of the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (hereinafter referred to as “the Ld. CIT(A)” passed u/s. 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for AY 2017-18, dated 26.01.2024, passed against the assessment order u/s. 147 read with section 144 of the Income-tax Act, 1961 (hereinafter referred to as the “Act”) by the ITO, Ward 49(1), Kolkata, dated 29.05.2023.
The grounds of appeal raised by the assessee are reproduced as under: “1 That on the facts and circumstances of the case the Ld. C.I.T (A) erred in accepting that the Notice issued u/s. 142(1) dated 12.05.2023 was served on the Appellant in time and there was non-compliance on the part of the Appellant and thereby justifying the levy of the Penalty.
Mrs. Suchitra Sengupta: AY: 2017-18 2. That on the facts and circumstances of the case the Ld. C.I.T (A) erred in non-considering the documentary evidences submitted in support of the proof that the Notice in question was not served on the Appellant in time and as such there was no failure on the part of the Appellant and accordingly no Penalty u/s. 272A (1)(d) of the Act was leviable. 3 That on the facts and circumstances of the case the Ld. C.I.T (A) erred in confirming the Penalty order by accepting blindly the contention of the A.O. and without relying on the documentary evidences available with him.
That the order passed u/s.250 of the Act by the Ld. C.I.T. (A) is bad in law. 5 That the Appellant craves leave to submit further grounds or alter, amend or modify the grounds already taken before or at the time of hearing of the Appeal.”
Brief facts of the case as stated are that the assessee is a senior citizen and a house-wife by profession having PAN BTNPS9577D but she had not been submitting her Income Tax Returns for any of the Assessment Years as her income had always been below the taxable limit. For the AY 2017-18, no return of income was filed by her as she was not having any taxable income. The Income Tax Officer, Ward-49(1), Kolkata issued one letter vide DIN & Letter No: ITBA/COM/F/2022- 23/1043113761(1) dated 23.05.2023. The said letter was received by her on 30.05.2022. As per the said letter it was intimated that income for the above Assessment Year had escaped assessment to the extent of Rs. 10,42,635/-, being the difference between the Stamp Authority Value and the Deed Value. In response to the notice received, the assessee, vide her letter dated 06.06.2022, which was filed with the office of the AO on the same day, denied entering into any agreement with anybody for the sale of any property on 18.08.2016 and stated that she had not received any sale proceeds as alleged in the aforesaid letter. Despite the reply, the AO made the addition of Rs. 10,42,635/- u/s 50C of the Act vide his order dated 29.05.2023 passed u/s 147 r.w.s.144 of the I.T. Act, 1961 against with the appeal is pending. The Ld. AO also initiated various penalty proceedings inclusive of penalty proceeding u/s. 272A (1)(d) of the I.T. Act, 1961. The Assessment Unit also issued Notice u/s 272A(1)(d) of the Mrs. Suchitra Sengupta: AY: 2017-18 Act. Relying on the AO's remarks made in the Assessment Order passed u/s 147 r.w.s.144 of the I.T. Act, 1961, the Assessment Unit mentioned that the Appellant had failed to comply with the Notice dated 12.05.2023 issued u/s. 142(1) of the Act. But no such Notice was received by the Appellant, which was confirmed by her in the affidavit sworn before the Notary Public. The Appellant is aggrieved with the Penalty Order passed by the Assessment Unit u/s. 272A (1)(d) of the IT. Act 1961; hence this appeal before the Tribunal.
4. During the course of the appeal, the Ld. AR filed a paper book containing the history of the case and it was stated that there was no non-compliance and reply was filed to various notices issued the assessing officer. The penalty proceedings under various sections, one of which was under section 272A(1)(d) of the Act for non-compliance to the notice dated 12.05.2023 issued under section 142(1) of the Act, were initiated. In compliance with the said penalty proceedings, the specific reply vide her letter dated17.07.2023 was filed with the office of the Ld. AO on 18.07.2023. It was stated that there was no non-compliance on her part at any stage of the proceedings and the notice dated 12.05.2023 was not received by her till the date of passing of the assessment order. The nonreceipt of the said notice was confirmed by an affidavit sworn before the Notary Public and the Ld. AO was intimated about the same and requested to keep the penalty proceedings in abeyance till the disposal of the appeal by the Ld. CIT(A). Another reply was filed on 04.09.2023 requesting to drop the penalty proceedings and not to keep the penalty proceeding in abeyance till the disposal of appeal, but without considering the reply, the penalty was imposed. In the appeal filed against the penalty order before the Ld. CIT(A), the assessee could not succeed as she had failed to Mrs. Suchitra Sengupta: AY: 2017-18 furnish any documentary evidence with regard to the late receipt/delivery of notice under section 142(1) dated 12.05.2023. It is stated that direct evidence i.e. the envelope which contained the notice under section 142(1) dated 12.05.2023 was misplaced and could not be traced out till the time being but the appellant, along with form No. 35, had filed an affidavit sworn before the notary public on 08.07.2023 but the Ld. CIT(A) did not consider the said affidavit while dismissing the appeal. It is stated that the direct evidence i.e. the envelope containing the notice under section 142(1) dated 12.05.2023 could be traced out later and the same has been submitted with the paper book for kind and sympathetic consideration of the tribunal along with the letter dated 17.07.2023 addressed to the assessing officer with reference to the penalty show cause notice issued and the notice under section 142(1) dated 12.05.2023 received through speed post on 17.07.2023 have been filed at pages 16 and from pages 19 to 23 respectively of the paper book. The Ld. Sr. DR relied on the order of the Ld. CIT(A).
We have heard the rival contentions and have gone through the facts of the case. The assessee had a reasonable cause for non-compliance to the notice u/s 142(1) dated 12.05.2023 as the same was received on17.07.2023 for which necessary evidence has been traced out and has been filed before us. The Ld. CIT(A) should have considered the affidavit filed in this regard. Since the assessee had a reasonable cause for non- compliance, considering the facts of the case, there was no justification for imposition of penalty and the penalty of Rs. 10,000/- imposed is hereby cancelled. Ground Nos. 1, 2 and 3
In the result, the appeal filed by the assessee is allowed. Order pronounced in the open court on 26th August, 2024.