Case Law Details
Ishoo Narang Vs ACIT (ITAT Hyderabad)
Income Tax Appellate Tribunal (ITAT) of Hyderabad upheld a penalty imposed on Ishoo Narang due to deliberate and willful disobedience non-compliance of notice under section 271 of the Income Tax Act.
Analysis: In this case, Ishoo Narang, an individual and director of two companies, failed to respond to notices from the Assessing Officer (AO) under sections 142(1) and 271(1)(b) of the Act. Despite several opportunities, Narang did not file any reply, leading the AO to impose a penalty of Rs. 10,000.
Narang argued that the failure was due to circumstances beyond his control and that there was no willful attempt on his part for non-compliance to the notice. However, the ITAT observed that Narang’s failure to comply constituted a deliberate and willful disobedience. The penalty under section 271(1)(b) is a technical one, usually levied when there is willful default on the part of the assessee.
An interesting point to note is that the penalty was upheld despite Narang eventually complying with the notice. This indicates that the ITAT takes the timeline of responses seriously and expects taxpayers to comply with the requirements promptly.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
