INCOME TAX ACT, 1961

Section 271(1)(b)

Penalty under section 271(1)(b) - Leviability - Assessee duly made compliance in response to notice under section 142(1) -

AO found that assessee did not comply with notice under section 142(1). Accordingly, a show cause notice was issued for initiation of penalty under section 271(1)(b). In response to the same, assessee duly furnished his reply. AO alleged that assessee did not furnish any supporting document in order to establish his claim, thus, reply was not found to be acceptable and penalty was levied under section 271(1)(b). CIT (A) confirmed the said penalty. Held: Before CIT (A), assessee placed particular fact on record that it duly made compliance in response to notice under section 142(1). Further, though assessee made a request for supplying of signed copy for reasons of re-assessment and approval under section 151 along with response to notice under section 142(1), however, penalty was imposed under section 271(1)(b) by AO, which was confirmed by CIT(A). It was also evident that as quantum appeal was pending before CIT (A), the assessee prayed for penalty proceeding to be kept in abeyance till finalization of such appeal. Therefore, considering the documents, particularly, e-proceedings response acknowledgement establishing the fact of reply made by assessee, the assessee could not be treated as assessee-in-default. Hence, penalty levied under section 271(1)(b) was not sustainable and the same was deleted accordingly.

REFERRED :

FAVOUR : In assessee's favour

A.Y. : 2013-14 to 2016-17

INCOME TAX ACT, 1961

Section 271F

SUBSCRIBE FOR FULL CONTENT