INCOME TAX ACT, 1961

Section 271(1)(b)

Penalty under section 271(1)(b) - Failure to comply with notices issued under section 142(1) at assessment proceedings - Assessee had a bona fide explanation for not filing the appeals within the period of limitation -

Assessee had filed an application for condonation of delay for 3 years consolidatedly supported by affidavit. Assessee contended that in all these years penalty was levied under section 271(1)(b) by AO for failure to comply with notices issued under section 142(1) at the assessment proceedings. Assessee submitted that AO in the assessment orders in absence of assessee passed the ex-parte Orders under section 153A/144 and determined the income of assessee on estimate basis. Held: Assessee was prevented by sufficient cause in not filing the appeals within the period of limitation and assessee had a bona fide explanation for not filing the appeals within the period of limitation. Even if assessee might not be strictly able to support the explanation for condonation of delay, the delay shall have to be condoned. Since the additions on merit have already been deleted by CIT(A) and no further appeals were pending, therefore, there might not be a default on the part of the assessee and at best it could be considered as a technical default, for which, penalty should not be levied by the authorities for failure to comply with the notices under section 142(1).

Followed:CIT (Central) v. Kabul Chawla (2016) 380 ITR 573 (Del.) : 2015 TaxPub(DT) 3486 (Del-HC)

REFERRED :

FAVOUR : In assessee's favour

A.Y. : 2005-06 to 2009-10

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