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Income Tax Appellate Tribunal, AHMEDABAD “SMC” BENCH, AHMEDABAD
Before: Ms. SUCHITRA KAMBLE
This appeal is filed by the assessee against order dated 27.10.2023 passed by the CIT(A), National Faceless Appeal Centre (NFAC), Delhi for the Assessment Year 2013-14.
The assessee has raised the following grounds of appeal :-
“1. The learned CIT(A) has erred in law and on facts of the case in confirming levy of penalty of Rs.40,000/- under Section 271(1)(b) of the Act.
2. Both the lower authorities have passed the orders without properly appreciating the facts and they further erred in grossly ignoring various submissions, explanations and information submitted by the appellant from time to time which ought to have been considered before passing the impugned order. The action of the lower authorities is in clear breach of law and principles of natural justice and therefore deserves to be quashed.”
The assessee filed his return of income on 05.09.2013 declaring total income of Rs.3,59,188/-. A search under Section 132 of the Income Tax Act, 1961 took place on 11.09.2018 in the case of Shri Sanjay Shah and Jignesh Shah. The search resulted in seizure of unaccounted cash of Rs.19,37,00,000/- related to accommodation entries and commission earned thereof. The case of the assessee was reopened under Section 147 of the Act after obtaining approval and notice under Section 148 of the Act which was issued on 25.03.2020. During the course of scrutiny assessment proceedings, the assessee did not file any response to the notice under Section 148 of the Act nor filed any submissions to the notice under Section 142(1) of the Act. Therefore, the Assessing Officer initiated penalty proceedings under Section 271(1)(b) of the Act. The assessee did not file any reply and, therefore, the Assessing Officer vide order dated 06.01.2022 passed penalty order under Section 271(1)(b) of the Act thereby directing the assessee to pay a sum of Rs.40,000/-.
Being aggrieved by the Assessment Order, the assessee filed appeal before the CIT(A). The CIT(A) dismissed the appeal of the assessee.
The Ld. AR submitted that there is a delay of 23 days in filing the present appeal but since the Accountant who was employed by the assessee inadvertently forgot to convey the order received from the Office of the CIT(A) and hence, the assessee could not file the appeal within the time. The delay appears to be genuine and, therefore, the delay of 23 days is condoned.
5.1 The Ld. AR further submitted that the notices were not complied as the notices were not served to the mentioned e-mail id. And, therefore, the assessee could not respond to the same. The Ld. AR requested that the matter may be remanded back to the file of the CIT(A) for proper adjudication of the issues on merit.
The Ld. DR relied upon the Assessment Order and the order of the CIT(A).
Heard both the parties and perused all the relevant material available on record. It is pertinent to note that the assessee did not receive any notice as such and, therefore, the assessee could not represent his case before the CIT(A). Therefore, it will be appropriate to remand back this matter to the file of the CIT(A) for proper adjudication of the issues on merit. Needless to say, the assessee be given opportunity of hearing by following the principles of natural justice. It is further directed that the assessee will fully co-operate with the hearing before the CIT(A) and if the assessee did not co-operate, the CIT(A) is at liberty to decide the case on merit.
In the result, appeal of the assessee is partly allowed for statistical purpose.
Order pronounced in the open Court on this 20th September, 2024.