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Income Tax Appellate Tribunal, DIVISION BENCHES ‘SMD’, CHANDIGARH
Before: MS. DIVA SINGH & Dr. B.R.R.KUMAR
PER DIVA SINGH
The present appeal has been filed by the assessee assailing the correctness of the order dated 26.07.2017 of CIT(A)-2 Ludhiana pertaining to 1996-97 assessment year on the following ground : 1. That the order of CIT(A)-2, Ludhiana be set aside since CIT(A)-2 has not considered the correct facts of the case 2. That the penalty of Rs.10000/- upheld by CIT(A)-2 may please be cancelled. 2. At the time of hearing, no one was present on behalf of the assessee. The appeal was passed over. Despite this, the assessee remained unrepresented. However, on considering the material available on record, it was deemed appropriate to proceed with the present appeal ex-parte qua the assessee appellant on merits after hearing ld. Sr.DR. 3. A perusal of the record shows that in the facts of the present case, it is seen that penalty u/s 271(1)(b) of the Income Tax Act,1961 has been levied by the AO taking note of the following facts; “In this case, assessment was completed u/s 144 of the Income Tax Act, 1961 on 15.03.1999. The Hon'ble ITAT and CIT(A) set aside the case on different issues to the Assessing Officer. Again assessment in this case was completed u/s 144 of the Income Tax Act,1961 on 26.03.2013 due to non cooperative attitude of the assessee.” It is further seen that thereafter the AO made a reference to various dates on which either the assessee was
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present and sought time; or none attended; or was represented by a counsel seeking adjournment. In the said background, the AO notes that time had been granted. However, on the subsequent dates, the assessee remained unrepresented. On account of this fact, the penalty under consideration was imposed. The relevant discussion in para 2(b) from the order is reproduced hereunder :
“2(b). The statutory notice u/s 143(2) was issued on. 16.09.2011 fixing the case for 30.09.2011. Notice was served upon assessee's mother. In compliance to this notice Sh. Push am Bansal the assessee himself attended and requested for adjournment. The case was adjourned to 05.10.2011. On 05.10.2011 none attended and no communication in writing was received in this office. On 11.10.2012, Sh. Amit Aggarwal, CA filed a letter stating therein that the assessee was not available on the date fixed and requested for 15 days adjournment. In response to this letter assessee was given 15 days time and the case was fixed for 29.10.2012 which was communicated to him vide this office letter dated 15.10.2012. Again on 29.10.2012 none attended and no written communication was received. The case was again fixed for 21.12.2012, 12.03.2013 and 21.03.2013 but none attended and no written communication received in this office.”
As a result of this, the AO imposed penalty u/s 271(1)(b). Said order was confirmed in appeal. It is seen that the assessee objected to the levy of penalty stating that the AO has not specifically pointed out the particular date noted by him which was not complied with. Reference to this submission is found made at page 7 of the impugned order. Reliance was placed upon ITA-1336/CHD/2016 dated 23.01.2017 in the case of M/s Swarnim Tie Up Pvt. Ltd. stating that without specifying the date on which the default is noticed, penalty cannot be imposed. It is seen that the CIT(A) has also taken note of the fact that the assessee has submitted the following submissions which are extracted from the impugned order ; “that the defaults committed by the assessee have not been mentioned in the notices issued to the assessee for imposition of penalty, has further been submitted that the Assessing Officer has not given or mentioned any date in the notices with regard to default under section 143(2)7142(1) of the Act. It has again been submitted that once there is no mention with regard to date of default as to whether under section 142(1) or under section 143(2) of the Act, the notices issued to the assessee are incomplete and bad in the eyes of law. It has again been submitted that the penal levied by the Assessing Officer in the case of the assessee without issuing proper and valid notices
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is also bad in law and may be deleted.” The said arguments were rejected by the CIT(A) taking note of the fact that the assessment was concluded u/s 144. The ld. Sr.DR relies on the same.
We find on going through the material available on record that not- withstanding the fact that the assessment was concluded u/s 144 of the Income Tax Act,1961 and also the fact that the assessee, as per record has been found to be non-cooperative, the short issue which falls for consideration in the present proceedings is, “whether the penalty imposed u/s 271(1)(b) in the facts of the present case is attracted or not ?”. When the wording of the Statute is taken into consideration, it is necessary to have the relevant fact on record namely; that AO has failed to address the specific date on which the assessee is found to have failed to comply with the notice issued. In the facts of the present case, it is seen that the said issue has been left unaddressed by the AO as well as the CIT(A). Accordingly, on this limited issue itself, the penalty imposed cannot be upheld. Accordingly, the appeal of the assessee is allowed. Penalty order is directed to be quashed. Said order was pronounced in the Open Court at the time of hearing itself. 6. In the result, appeal of the assessee is allowed. Order pronounced in the Open Court on 16.07. 2018.
Sd/- Sd/- (Dr.B.R.R.KUMAR) ( DIVA SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER
‘Poonam’ Copy to: 1. The Appellant 2. The Respondent 3. The CIT 4. The CIT(A) 5. The DR
Asstt. Registrar ITAT,Chandigarh.