Jarul Glasswork Private Limited Vs ITO (ITAT Delhi)
The issue before the Tribunal is levy Penalty of ₹10,000 levied u/s 271(1)(b) for alleged non-compliance with a notice u/s 142(1). Assessee argued that he had complied with notices issued on 13.07.2018 (responded on 18.08.2018) and 21.08.2018 (responded on 04.10.2018). Show-cause notice dated 24.09.2018 was also complied with on 04.10.2018. No second show-cause or opportunity was given before levying the penalty on 20.03.2019. Penalty was imposed despite assessment being completed u/s 143(3), indicating substantive compliance. Delay in appeal before CIT(A) was not condoned & appeal was dismissed without examining merits.
ITAT’s relied on Hindustan Steel Ltd. (83 ITR 26 SC) to hold that Penalty should not be imposed unless there’s deliberate defiance or contumacious conduct. Tribunal noted that compliance was eventually ensured and penalty seemed to be used merely as a deterrent tool. Tribunal found no willful default or disregard of obligation by Assessee.
Tribunal set aside the order & delete the penalty of Rs. 10,000/-.
FULL TEXT OF THE ORDER OF ITAT DELHI
The appeal of the assessee for the Assessment Year (hereinafter, the ‘AY’) 2016-17 is directed against the order dated 14.08.2024 passed by the Additional/Joint Commissioner of Income Tax (Appeals)-9, Mumbai [hereinafter, the ‘ Addl. CIT(A)’].
