USHA GOYAL,NEW DELHI vs. ACIT CIRCLE 43(1), NEW DELHI

ORDER

PER KUL BHARAT, JM :

no. 1, the Ld. CIT (A) erred in law and facts in confirming penalty imposed of Rs 10,000/- u's 271(1)(b) of the Act even though the Ld. AO has framed assessment u/s 147 r.w.s 143(3) instead of 144 of the Act, which implies that subsequent compliances made by the appellant were considered as good compliance and the defaults committed earlier were ignored by him.

2. The appellant craves leave to add, amend or alter any of the grounds of appeal.

3. That on the facts and in the circumstances of the case, the Ld. CIT (A) erred in law and facts in confirming penalty imposed of Rs

10,000/- u/s 271(1)(b) of the Income Tax Act, 1961 without appreciating the facts that there was no non-compliance of notice issued u/s 142(1) of the Act dated 06.11.2019 on the scheduled date 08.11.2019, as the appellant duly filed adjournment before the Ld. AO and later on filed all requisite details and documents. 4. Without prejudice to the Ground of Appeal no. 1, the Ld. CIT (A) erred in law and facts in confirming penalty imposed of Rs 10,000/- u/s 271(1)(b) of the Act without appreciating the facts that alleged non- compliance of notice issued u/s 142(1) of the Act dated 06.11.2019, if any was not deliberate and due to reasonable cause, therefore provisions of section 273B of the Act is applicable in the case of the appellant.”

3. Facts giving rise to the present appeal are that the case of the assessee was re-opened on the basis of information received regarding accommodation entries taken by the assessee from Shri Anand Kumar Jain and Shri Naresh Kumar Jain. During the course of assessment proceedings, the Assessing Officer (“AO”) initiated penalty proceedings u/s 271(1)(b) of the Income Tax Act, 1961 (“the Act”) on the basis that the assessee failed to comply with the notice issued u/s 142(1) of the Act. Thereafter, vide order dated 06.07.2021, the Assessing Authority imposed penalty u/s 271(1)(b) of the Act, amounting to INR 10,000/- to the assessee.

4. Aggrieved against this, the assessee preferred appeal before Ld.CIT(A), who after considering the submissions, sustained the penalty.

5. Aggrieved against the order of Ld.CIT(A), the assessee preferred appeal before this Tribunal.

6. Ld. Authorized Representative (“AR”) of the assessee submitted that the notice was not received by the assessee. Therefore, the assessee could not make compliance of the notice. He further contended that non-receipt of the notices was the reason for non-compliance. As the assessee was having reasonable cause for non-compliance, he prayed that the impugned penalty may be deleted.

7. On the other hand, Ld. Sr. DR opposed these submissions and supported the orders of the authorities below. He contended that the assessee should have complied with the notice and the AO has rightly imposed the penalty u/s 271(1)(b) of the Act.

8. I have heard Ld. Authorized Representatives of the parties and perused the material available on record. Looking to the facts and contentions of the assessee that the notice was not received by the assessee. Therefore, I am of the considered view that the assessee was having reasonable cause for non- compliance of the notice hence, the impugned penalty is hereby, deleted.