Panhera Gramin Bigarsheti Vs ITO (ITAT Nagpur)
The Income Tax Appellate Tribunal (ITAT) Nagpur Bench has provided significant relief to Panhera Gramin Bigarsheti, a cooperative society, by quashing two separate penalties imposed by the Assessing Officer (AO) for the Assessment Year 2020-21. The appeals stemmed from orders by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, which had upheld the penalties.
Penalty for Non-Compliance Overturned
In the first appeal (ITA No. 495/Nag./2024), the cooperative was penalized Rs. 30,000 by the AO for failing to comply with three statutory notices issued under Section 142(1) of the Income Tax Act, 1961. Each non-compliance attracted a penalty of Rs. 10,000.
The assessee had challenged this penalty before the CIT(A), but its appeal was dismissed due to a significant delay of 396 days in filing. The CIT(A) found the reasons for the delay insufficient and did not condone it, thus not addressing the merits of the penalty.
Before the ITAT, the cooperative again faced a delay, this time of 29 days in filing its second appeal. Acknowledging the delay, the ITAT condoned it, noting the assessee’s explanation of insufficient staff and a lack of knowledge regarding income tax proceedings within its office. The Tribunal deemed these reasons acceptable and, in the interest of natural justice, proceeded to quash the entire penalty of Rs. 30,000 levied by the Assessing Officer.
