ITAT Allahabad Judgments — July 2022

The Tribunal found that the Pr. CIT's revision under Section 263 was not fully justified as some issues were based on assumptions or were not properly substantiated. However, certain aspects of the Pr. CIT's concerns warranted further examination.

The Tribunal found that the Pr. CIT's revision under Section 263 was not fully justified as some issues were based on assumptions or were not properly substantiated. However, certain aspects of the Pr. CIT's concerns warranted further examination.

The Tribunal held that for assessment years 2014-15 to 2016-17, the Assessing Officer issued notice under section 148 on 17.10.2018, allowing 30 days for filing the return. However, before the expiry of this period, the Assessing Officer issued a notice under section 142(1) on 30.10.2018. The assessee had requested copies of impounded documents on 29.10.2018. The Tribunal found that the Assessing Officer ignored these requests and issued the section 142(1) notice prematurely. The non-supply of impounded material, including audited statements of accounts, made the assessee handicapped in complying with the notices. The Tribunal concluded that the assessee had a reasonable cause for non-compliance, falling under section 273B, and thus deleted the penalty. For assessment year 2017-18, the facts were identical regarding the non-supply of impounded material. The Tribunal noted that copies of seized documents were supplied only on 28.01.2019, just before the penalty order was passed on 30.01.2019, indicating the assessee was deprived of necessary records. Therefore, the Tribunal found a reasonable cause for non-compliance and deleted the penalty for this year as well. The ratio decidendi is that non-supply of crucial documents by the Revenue, requested by the assessee for compliance, constitutes a reasonable cause for non-compliance with statutory notices, warranting deletion of penalty under section 271(1)(b).

The Tribunal held that for assessment years 2014-15 to 2016-17, the Assessing Officer issued notice under section 148 on 17.10.2018, allowing 30 days for filing the return. However, before the expiry of this period, the Assessing Officer issued a notice under section 142(1) on 30.10.2018. The assessee had requested copies of impounded documents on 29.10.2018. The Tribunal found that the Assessing Officer ignored these requests and issued the section 142(1) notice prematurely. The non-supply of impounded material, including audited statements of accounts, made the assessee handicapped in complying with the notices. The Tribunal concluded that the assessee had a reasonable cause for non-compliance, falling under section 273B, and thus deleted the penalty. For assessment year 2017-18, the facts were identical regarding the non-supply of impounded material. The Tribunal noted that copies of seized documents were supplied only on 28.01.2019, just before the penalty order was passed on 30.01.2019, indicating the assessee was deprived of necessary records. Therefore, the Tribunal found a reasonable cause for non-compliance and deleted the penalty for this year as well. The ratio decidendi is that non-supply of crucial documents by the Revenue, requested by the assessee for compliance, constitutes a reasonable cause for non-compliance with statutory notices, warranting deletion of penalty under section 271(1)(b).

The Tribunal held that for assessment years 2014-15 to 2016-17, the Assessing Officer issued notice under section 148 on 17.10.2018, allowing 30 days for filing the return. However, before the expiry of this period, the Assessing Officer issued a notice under section 142(1) on 30.10.2018. The assessee had requested copies of impounded documents on 29.10.2018. The Tribunal found that the Assessing Officer ignored these requests and issued the section 142(1) notice prematurely. The non-supply of impounded material, including audited statements of accounts, made the assessee handicapped in complying with the notices. The Tribunal concluded that the assessee had a reasonable cause for non-compliance, falling under section 273B, and thus deleted the penalty. For assessment year 2017-18, the facts were identical regarding the non-supply of impounded material. The Tribunal noted that copies of seized documents were supplied only on 28.01.2019, just before the penalty order was passed on 30.01.2019, indicating the assessee was deprived of necessary records. Therefore, the Tribunal found a reasonable cause for non-compliance and deleted the penalty for this year as well. The ratio decidendi is that non-supply of crucial documents by the Revenue, requested by the assessee for compliance, constitutes a reasonable cause for non-compliance with statutory notices, warranting deletion of penalty under section 271(1)(b).

The Tribunal held that for assessment years 2014-15 to 2016-17, the Assessing Officer issued notice under section 148 on 17.10.2018, allowing 30 days for filing the return. However, before the expiry of this period, the Assessing Officer issued a notice under section 142(1) on 30.10.2018. The assessee had requested copies of impounded documents on 29.10.2018. The Tribunal found that the Assessing Officer ignored these requests and issued the section 142(1) notice prematurely. The non-supply of impounded material, including audited statements of accounts, made the assessee handicapped in complying with the notices. The Tribunal concluded that the assessee had a reasonable cause for non-compliance, falling under section 273B, and thus deleted the penalty. For assessment year 2017-18, the facts were identical regarding the non-supply of impounded material. The Tribunal noted that copies of seized documents were supplied only on 28.01.2019, just before the penalty order was passed on 30.01.2019, indicating the assessee was deprived of necessary records. Therefore, the Tribunal found a reasonable cause for non-compliance and deleted the penalty for this year as well. The ratio decidendi is that non-supply of crucial documents by the Revenue, requested by the assessee for compliance, constitutes a reasonable cause for non-compliance with statutory notices, warranting deletion of penalty under section 271(1)(b).

The Tribunal held that the CIT(A) judiciously exercised its discretion in not condoning the substantial delay as the assessee failed to show sufficient cause. The Tribunal found no merit in interfering with the CIT(A)'s order.

The ITAT held that the CIT(A) erred by accepting additional evidence without following Rule 46A of the Income Tax Rules, 1962, which requires forwarding such evidence to the AO for remand report. The appellate order was set aside.