Penalty U/s 272A(1)(d) Deleted: Reasonable Cause Subsequent Compliance Accepted

Tarla Jagdish Chauhan Vs CIT (ITAT Mumbai)

Penalty U/s 272A(1)(d) Deleted: Reasonable Cause Subsequent Compliance Accepted

The assessee was levied a penalty of ₹20,000 under Section 272A(1)(d) for non-compliance with notices issued u/s 142(1). The delay was explained on the ground that the registered email ID was hacked, and notices continued to be sent to that inaccessible email despite subsequent update.

The Tribunal noted that once the assessee became aware, all required details were duly furnished, and importantly, the AO accepted the submissions in full while completing assessment u/s 147. The assessment was not ex-parte, and the returned income was accepted.

Given that there was a reasonable cause for delay and substantial compliance was eventually made, the ITAT held that levy of penalty was unjustified. Accordingly, the penalty was deleted, and the assessee’s appeal was allowed.

FULL TEXT OF THE ORDER OF ITAT MUMBAI

This appeal filed by the assessee is against the order of National Faceless Appeal Centre (NFAC) / CIT(A), Delhi, vide order no. ITBA/NFAC/S/250/2025-26/1083832174(1), dated 18.12.2025, passed against the penalty order by Assessment Unit, u/s. 272A(1)(d) of the Income-tax Act (hereinafter referred to as the “Act”), dated 22.05.2025, for Assessment Year 2017-18.

2. In this appeal assessee is contesting on levy of penalty of Rs.20,000/- u/s. 272A(1)(d).

3. There is a delay of 167 days noted by the Registry in filing the present appeal before the Tribunal, for which petition of condonation of delay along with affidavit is placed on record.

3.1. We have considered the petition for condonation of the said delay. Upon perusal of the same and hearing both sides, we deem it fit to condone the delay on the ground that there was sufficient cause for the said delay. Accordingly, we take up the matter for adjudication.

4. Brief facts of the case as culled out from the records are that originally assessee did not file her return of income. Based on information received under Risk Management Strategy formulated by the Central Board of Direct Taxes (CBDT) which suggested that assessee has entered into the transactions of purchase of immovable property amounting to Rs.1,01,50,000/- and transaction of purchase of debentures amounting to Rs.40 lakhs. Case of the assessee was taken up by invoking provisions of section 148. Assessee filed her return of income in response to the notice u/s. 148, reporting total income at Rs.2,620/-. In the course of assessment proceedings, statutory notices were issued, for which assessee furnished delayed replies which resulted into initiation of proceedings u/s. 272A(1)(d). Impugned penalty order was passed on 22.05.2025, imposing penalty of Rs. 20,000/- for non-compliance of notices issued u/s. 142(1) dated 30.08.2024 and 18.09.2024. The penalty so imposed was confirmed by the ld. CIT(A), against which assessee is in appeal before the Tribunal.

5. We have heard both the parties and perused the material on record. Contention of the ld. Counsel for the assessee is that email ID on which notices were sent was hacked, because of which assessee could not access the emails. Subsequently, email ID was updated on the IT profile on 22.03.2024. However, notices continued to be sent on the old email ID which was hacked and was inaccessible. Subsequently, on review of the IT portal, assessee became of aware of certain pending notices which required response. Assessee took the appropriate actions and furnished all the necessary submissions.

5.1. Ld. Counsel pointed from the assessment order, wherein ld. Assessing Officer has acknowledged in para-3 and 4 about the detailed reply furnished by the assessee. In para-3, he notes, “The assessee along with a detailed reply has also submitted the copy of sale deed, purchase agreement, income computation statement along with schedules and capital gains or loss computation statement, etc”. In Para-4, ld. Assessing Officer has narrated all the relevant facts relating to the transactions which led to the invocation of proceedings u/s. 148. He notes in this para, “the assessee contention in her various replies and the details submitted are verified and found to be in order. The reply of the assessee has been examined and found to be acceptable”. Thus, while completing the assessment in para-5, he records that after considering the facts of the case and submissions of the assessee, income reported in return filed in response to the notice u/s.148 was accepted as total income for completing the assessment. Thus, it is evidently demonstrated that assessee made all the submissions before passing of the assessment order which has been accepted. Delay in filing the submissions has been duly explained by the assessee for which reasonable cause existed.

5.2. It is further noted that the assessment has been completed u/s. 147 r.w.s. 144B and is not an ex parte assessment. Accordingly, in view of the above stated factual position, penalty imposed by the ld. Assessing Officer u/s. 272A(1)(d) is not justified. The penalty so levied is deleted. Grounds raised by the assessee are allowed.

6. In the result, appeal of the assessee is allowed.

Order is pronounced in the open court on 16 April, 2026