The impugned penalty proceedings u/s 271(1)(b) has been levied for non-compliance of one notice u/s 142(1) fixing the date of hearing of the case on 18.07.2013. Prior to this notice the assessee had duly complied with all the notices and even compliance was made to subsequent notices and that is why the assessment has been completed u/s 143(3). The reasons given by the assessee for non- compliance for particular date was that – the assessee was suffering from UTI and Typhoid fever and this fact has not been rebutted by the Ld. CIT (Appeals), because the same reasons was cited before the Assessing Officer through reply filed in dak. The Ld. CIT (Appeals) has accepted the said reasons for some of the years, because out of 7 assessment years for which penalty was levied for non compliance of notice dated 11.7.2013, he has deleted the penalty for 3 years and balance 4 years has been confirmed. If there was a reasonable cause within the ambit of section 273B for 3 years for default of same notice, then no penalty u/s 271(1) (b) should be imposed. Medical illness and that to be in the nature of the typhoid fever and UTI is definitely reasonable cause for non- appearing on the date and therefore, we are of the opinion that no penalty should be levied u/s 271(1)(b) in such circumstances as the same is covered under exception of ‘reasonable cause’ as enshrined in section 273B. Thus, the penalty levied u/s. 271(1)(b) for sum of Rs. 10,000/- for each assessment year is hereby deleted.
Full Text of the ITAT Order is as follows:-
The Assessee has filed this Appeal against the impugned order dated 26/5/2014 passed by the Ld. Commissioner of Income Tax (Appeals)- XXXI.
- The grounds raised in this Appeal read as under:-
1. That having regard to facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. AO in levying penalty of Rs. 10,000/- u/s. 271(1)(b) of the Income Tax Act, 1961 which was levied without any basis and without granting adequate opportunity of hearing and more so when the Ld. CIT(A) himself deleted the penalty in subsequent three assessment years which was levied by the AO on same set of facts.
2. That having regard to facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of AO in framing the impugned penalty order without assuming jurisdiction as per law and without recording mandatory satisfaction as per law and without appreciating the facts and circumstances of the case.
3. That in any view of the matter and in any case, action of Ld. CIT(A) in confirming the action of AO in imposing the penalty of Rs. 10,000/- u/s. 271(1)(b) is barred buy limitation, illegal, beyond jurisdiction, in violation of principles of natural justice, by recording incorrect facts and findings, contrary to law and facts and the same is not sustainable on various legal and factual grounds and deserves to be quashed.
4. That the appellant craves the leave to add, modify, amend or delete any of the grounds of appeal at the time of hearing and all the above grounds are without prejudice to each other.
3. The facts narrated by the revenue authorities are not disputed by both the parties, hence, the same are not repeated here for the sake of brevity.
4. At the time of hearing, Ld. Counsel of the Assessee stated that exactly on similar grounds the ITAT has deleted the similar penalty in the case of Sh. Praveen Sawhney in ITA Nos. 4039, 4040, 4041 & 4042/Del/2014 (Ayrs. 2006-07 to 2009- 10) vide order dated 27.4.2017. He draw our attention towards para no. 4 to 6 at page no. 3 to 5 of the Tribunal’s order dated 27.4.2017, as aforesaid and requested to respectfully follow the aforesaid order of the Tribunal and penalty in dispute may be deleted and appeals of the Assessee may be allowed. He further stated that recently the ‘G’ Bench of the ITAT, Delhi vide its order dated 05.05.2017 in assessee’s own case for the assessment years 2007-08 to 2009-10 passed in ITA No. 4036 to 4038/Del/2014, by following its aforesaid order dated 27.4.2017 has deleted the penalty in dispute.
5. We have heard both the parties and perused the records, especially the orders of the revenue authorities as well as order of the Tribunal’s dated 27.4.2017 passed in the case of Sh. Praveen Sawhney in ITA Nos. 4039, 4040, 4041 & 4042/Del/2014 (A yrs. 2006-07 to 2009-10) and recent order dated 05.5.2017 in assessee’s own case for the assessment years 2007-08 to 2009-10 passed in ITA No. 4036 to 4038/Del/2014. After perusing the aforesaid documentary evidences, we find force in the contention raised by the Ld. Counsel of the Assessee that the issues involved in the present appeals are similar and identical to that case of Sh. Praveen Sawhney (Supra) and in assessee’s own case (Supra), hence, the issues involved in the present appeals are squarely covered by the Tribunal’s orders dated 27.4.2017 and 05.5.2017, as aforesaid, passed in the case of Sh. Praveen Sawhney in ITA Nos. 4039, 4040, 4041 & 4042/Del/2014 (A yrs. 2006-07 to 2009- 10) and in assessee’s own case for the assessment years 2007- 08 to 2009-10 passed in ITA No. 4036 to 4038/Del/2014. For the sake of convenience, we are reproducing only the relevant para no. 4 to 6 mentioned at page no. to 5 of the aforesaid Tribunal’s order dated 27.4.2017 as under:-
“4. We have heard the rival submissions and also perused the relevant finding given in the impugned order. In the case of the assessee for all the impugned years the proceedings have been initiated in wake of search and seizure operation and in compliance of notices u/s. 153A. Apart from that, from time to time various notices have been issued u/s. 142(1) and also various questionnaires from time to time which has been duly responded here under:-
2. Notice u/s. 153A of Income Tax Act, 1961 dated 16.05.2012 was issued to the assessee requiring him to file the return for the assessment year 2007- 08. In response to notice u/s. 153A, the return of income for the Assessment Year 2007- 08 was filed by the assessee on 25.06.2012 declaring an income of Rs.5,86,950/-. A questionnaire along with notice 142(1) & 143(2) was issued to the assessee on 28.05.2012 & 15.10.2013 requiring him to file necessary details. Further notice u/ s 142(1) dated 28.10.2014 was issued to the assessee for furnishing the details as asked for in earlier questionnaires,3. In response to aforesaid notices, Shri Jitender Goel, C.A, & Authorized Representative of the assessee, attended the proceedings and filed power of attorney & necessary details from time to time.”
5. The impugned penalty proceedings u/s 271(1)(b) has been levied for non-compliance of one notice u/s 142(1) fixing the date of hearing of the case on 18.7.2013. Prior to this notice the assessee had duly complied with all the notices and even compliance was made to subsequent notices and that is why the assessment has been completed u/s 143(3). The reasons given by the assessee for non- compliance for particular date was that – the assessee was suffering from UTI and Typhoid fever and this fact has not been rebutted by the Ld. CIT(Appeals), because the same reasons was cited before the Assessing Officer through reply filed in dak. The Ld. CIT (Appeals) has accepted the said reasons for some of the years, because out of 7 assessment years for which penalty was levied for non compliance of notice dated 11.7.2013, he has deleted the penalty for 3 years and balance 4 years has been confirmed. If there was a reasonable cause within the ambit of section 273B for 3 years for default of same notice, then no penalty u/s 271(1) (b) should be imposed. Medical illness and that to be in the nature of the typhoid fever and UTI is definitely reasonable cause for non- appearing on the date and therefore, we are of the opinion that no penalty should be levied u/s 271(1)(b) in such circumstances as the same is covered under exception of ‘reasonable cause’ as enshrined in section 273B. Thus, the penalty levied u/s. 271(1)(b) for sum of Rs. 10,000/- for each assessment year is hereby deleted.
6. In the result, all the appeals filed by the assessee for the aforementioned assessment years are allowed.”
6. After perusing the aforesaid findings of the Tribunal in the case of Praveen Sawhney (Supra), we of the firm opinion that the issues involved in the present appeals are squarely covered in favor of the assessee, therefore, respectfully follow the precedents, as aforesaid, we delete the penalty in dispute in all the appeals and accordingly, allow the Appeal of the assessee.
7. In the result, the appeal of the Assessee is allowed.
Order pronounced in the Open Court on 12/05/2017.
