Case Law Details
Ganpat Singh Vs ITO (ITAT Indore)
Five Notices, One Query: ITAT Restricts 271(1)(b) Penalty to ₹10,000- When Multiple 142(1) Notices Seek Same Info—Only One Default Survives
Assessee, an agriculturist, filed appeal belatedly against penalty of ₹50,000 levied u/s 271(1)(b) for alleged non-compliance with five consecutive notices issued u/s 142(1). Delay was supported by affidavit stating prolonged illness & financial hardship. Tribunal noted the Assessee’s ailing condition & absence of mala fide, & applying the Supreme Court ruling in Collector, Land Acquisition v. Mst. Katiji, condoned the delay to advance substantial justice.
On merits, the Assessee argued that all five notices sought the same information regarding a land-sale transaction, & therefore non-compliance constituted a single default. Tribunal accepted this plea, relying on settled law including ITAT Pune’s 14.10.2025 decision in Devraj Vishwasrao Jadhav v. ITO. It held that repeated notices on the same query do not multiply defaults. Applying section 273B, Tribunal restricted penalty to ₹10,000 for the first non-compliance & deleted the remaining ₹40,000. Appeal was partly allowed.
FULL TEXT OF THE ORDER OF ITAT INDORE
Feeling aggrieved by order of first-appeal dated 21.03.2022 passed by Commissioner of Income-tax (Appeals), NFAC, Delhi [“CIT(A)”] which in turn arises out of penalty-order dated 14.06.2018 passed by ITO-3(1), Bhopal [“AO”] u/s 271(1)(b) of the Income-tax Act, 1961 [“Act”], the assessee has filed this appeal.
2. This appeal is belatedly filed after expiry of statutory time period. Ld. AR for assessee submitted that the assessee is an individual engaged in agriculture. She submitted that the assessee has filed a condonation-application/affidavit giving reason of delay and praying for condonation. Referring to contents of application/affidavit, she submitted that the assessee is passing through ailing condition and owing to same, this appeal could not have been filed in time. She submitted that there is no deliberate reason or malafide intention to make delay and the assessee does not stand to derive any benefit by delayed filing. She submitted that the assessee is financially at ground level and does not have any means to pay the penalty of Rs. 50,000/- imposed by AO u/s 271(1)(b) for non-compliances of the notices issued u/s 142(1). With folded hands on behalf of assessee, she prayed that this Court should take a very judicious view and considering the ailing condition of assessee and meritorious nature of appeal, condone delay to impart substantial justice. Ld. DR for Revenue submitted that the assessee had remained non-compliant in all proceedings, viz. the assessment-proceeding, penalty-proceeding and first appellate proceeding. Therefore, the delay should not have been condoned but, however, he left the matter for the wisdom of bench considering the ailing and financially constrained condition of assessee as informed by Ld. AR in open court. We have considered the submission and repeat emphasis made by Ld. AR in open court narrating the ailing condition of assessee which has led to delayed filing of present appeal coupled with her submission that the assessee is finally much weaker. Accordingly, we are inclined to take a liberal view in the matter of section 253(5) of the Act which empowers the ITAT to admit an appeal after expiry of prescribed time. It is also a settled position by Hon’ble Supreme Court in Collector, Land Acquisition Vs Mst. Katiji and others 1987 AIR 1353, 1987 2 SCC 387 that whenever “substantial justice” and “technical considerations” are opposed to each other, the cause of substantial justice must be preferred by adopting a justice-oriented approach. In the very same decision, the Hon’ble Supreme Court has also observed “It must be grasped that judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so.” Therefore, we take condone delay, admit appeal and proceed with hearing.
3. The assessee in present case is aggrieved by a penalty of Rs. 50,000/- imposed for non-compliances of five (5) successive notices issued by AO u/s 142(1). Ld. AR for assessee submitted that the five notices dated 28.06.2017, 10.08.2017, 03.10.2017, 13.11.2017 and 12.12.2017 were issued by AO and in response to one notice dated 10.08.2017, CA Piyush Agarwal attended on behalf of assessee. Further, Ld. AR also submitted that by means of all those five (5) notices, the AO’s query was qua the sale of land made by assessee. Therefore, the non-compliances of all five notices should be construed as a single failure and the penalty should be restricted to Rs. 10,000/- only. We find merit in the contention of the Ld. AR for the assessee that where the notices have been issued by the AO, one after another, seeking the same information, it will not multiply the default and it would constitute a single default. This proposition is supported by plethora of decisions including the recent decision dated 14.10.2025 given by ITAT, Pune Bench in Devraj Vishwasrao Jadhav Vs. ITO, Satara, ITA No. 1002/Pun/2025. Accordingly, in the light of same and also considering the provisions of section 273B of the Act, we are of the view that the penalty for first non-compliance deserves to be confirmed and for the subsequent non-compliances penalty deserves to be deleted. We therefore restrict the penalty levied u/s 271(1)(b) of the Act to one default as against five defaults treated by Ld. AO. Accordingly, we confirm penalty of Rs. 10,000/- and rest of the penalty of Rs. 40,000/- is deleted.
4. Resultantly, this appeal is partly allowed.
Order pronounced in open court on 28/11/2025
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