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Income Tax Appellate Tribunal, CHANDIGARH BENCH, ‘SMC’, CHANDIGARH
Before: DR KRINWANT SAHAY & SHRI PARESH M. JOSHI
आदेश/Order
Per Dr. Krinwant Sahay, A.M.:
Appeal in this case has been filed by the Assessee against the order dated 16.11.2023 of the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi.
2. Grounds of appeal are as under: - 1. That the order of Learned C.I.T. (Appeals) is bad and against the facts and Law.
38-Chd-2024 – Aditya Footwears Pvt. Ltd, Chandigarh 2
That the Learned C.I.T (Appeals) has wrongly upheld penalty of Rs. 10,000/- u/s 271(l)(b) on surmises and conjectures.
3. That the Learned C.I.T (Appeals) has wrongly upheld penalty u/s 271(l)(b) of the Act without considering the response submitted by the appellant company.
4. That the appellant craves leave to add, alter, amend or withdraw any grounds of disallowances made in the assessment.
During the proceedings before us, the ld. Counsel for the Assessee filed the written submissions on this issue which are as under: - “In this regard it is submitted that the learned assessing officer has wrongly initiated penalty u/s 271(l)(b) of the Act without considering the reply of the appellant company submitted on 28.03.2022 and 29.03.2022.
It is submitted that the effective and overall management of the appellant company was vested with Director Sh. Sanjiv Bansal, since the incorporation of the company till the sudden and unfortunate death of Sh. Sanjiv Bansal owing to brain cancer on 12.12.2016. Thereafter, the assessee company stopped its business activity after his death and the affairs of the assessee company were being looked after by its Director, Sh. Balwant Rai Bansal (father of Late Sh. Sanjiv Bansal) 'to best of his ability' considering his old age i.e. 82 years at present. However,
38-Chd-2024 – Aditya Footwears Pvt. Ltd, Chandigarh 3 since past 2-3 years, the health of Sh. Balwant Rai Bansal has continuously deteriorated.
Further, it is submitted that all the statutory notices and the final show cause notice dated 07.02.2022 had been delivered to the secondary registered mail id of the assessee instead of primary registered mail id of the assessee on income tax portal. However, after the appellant received notices through speed post, then only the assessee tried to collect details / information from the ex-auditor, bank and other sources to submit satisfactory, reply to your notices. With great efforts, we were able to submit complete details to the satisfaction of your goodself before finalization of the assessment.”
The Assessee made submissions before the Assessing Officer, but the A.O. did not accept the submissions filed by the Assessee and levied a penalty us 271(1)(b) of the Income Tax Act, 1961 (in short 'the Act') of Rs. 10,000/-.
Aggrieved with the order of the Assessing Officer, the Assessee filed an appeal before the ld. CIT(A) and submitted the same facts which he had submitted before the Assessing Officer but the ld. CIT(A) also did not concede the request of the Assessee and confirmed the order passed by the Assessing Officer.
38-Chd-2024 – Aditya Footwears Pvt. Ltd, Chandigarh 4 6. Aggrieved with the order of the ld. CIT(A), the Assessee has filed this appeal before us.
During the proceeding before us, the Counsel of the Assessee again reiterated the same facts. From the submissions of the Counsel of the Assessee, it is clear that the overall management of the Assessee company was being looked after by its Director Mr. Sanjeev Bansal, who died because of brain Cancer. After the death of Mr. Sanjeev Bansal, the Company had stopped its business activity and affairs of the company was being looked after by the father of late Shri Sanjeev Bansal. However, because of his old age, Mr. Balwant Rai Bansal (father of late Shri Sanjeev Bansal) could not respond the Department in time though information was filed belatedly.
The ld. DR relied on the orders of the Assessing Officer and CIT(A).
After considering the submissions of the Counsel of the Assessee, the submissions filed before the authorities below and the arguments made before us by the Counsel of the Assessee and DR, we find that there was sufficient reason for the Assessee for not responding to the notices in time and, accordingly, the appeal of the Assessee is allowed on this issue. No other issue has been raised.
38-Chd-2024 – Aditya Footwears Pvt. Ltd, Chandigarh 5
In the result, the appeal of the Assessee is allowed. Order pronounced on 29.07.2024.