Habitual Default of Non-filing of Income Tax Returns despite having Taxable Income: ITAT Upholds Penalty [Read Order]

The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) has held that the non-filing of income tax returns for a period of four years despite having taxable income would attract penalty under section 273B of the Income Tax Act, 1961.

The assessee, Shri. Rajesh Suresh Vernekar was aggrieved by the order of the income tax department wherein the AO noted that the assessee has committed default by filling his income tax return as per section 139(1) and filled return as per section 139(4) of the Act. Therefore, the penalty proceeding under section 271F of the Act was initiated vide notice dated 10.10.2017 under section 274 r.w.s. 271F of the Income Tax Act.

A bench of George George K, Judicial Member and Shri Laxmi Prasad Sahu, Accountant Member observed that “in all the 4 years, the income of the assessee was above the taxable limit and he was required to file IT returns within the due date as prescribed under section 139(1) of the Act but we noted that in all the 4 years, as noted supra, in any of the 4 Assessment Years, the assessee did not file his return within the due date. The impugned defaults can only be considered as a conscious disregard of once statutory obligations, and the penalty stands rightly levied as the assessee is a habitual defaulter.”

Upholding the penalty orders, the ITAT held that “We also reject the arguments of the learned Authorized Representative that the order passed by the AO is beyond time limit. The AO issued noticed on 10.10.2017 and passed his order on 13.10.2017, which is well within the time. We also observe from the orders of the lower authorities that the assessee could not establish any reasonable cause for delay in filing of his IT Returns, even during the course of hearing, before us, could not point out any reasonable cause so as to any reasonable cause can be considered for granting relief to the assessee as per section 273B of the Act. Accordingly, we uphold the order of the lower authorities and dismiss the appeals of the assessee.”

To Read the full text of the Order CLICK HERE

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