In a significant ruling, the Ahmedabad bench of the Income Tax Appellate Tribunal (ITAT) has imposed a penalty of Rs. 5000 on an assessee on the grounds of a delay of 358 days in filing appeal and non-co-operation with the income tax department during the assessment proceedings.
The assessee, who is an individual, took a defense that could not file the appeal due to change in the place of employment i.e. from Ahmedabad to Pune.
As per section 253(5) of the Act, the Tribunal is empowered to condone the delay if the appeal was not presented by the assessee within the time due to some unavoidable reason.
Regarding the contentions of the assessee, the Tribunal observed that the condonation petition was not supported with the corroborative evidence for shifting employment from Ahmedabad to Pune.
“We are not ignorant of the fact that the assessee should be penalized for the default committed by him for not presenting the appeal in time but in our considered view the penalty should be commensurate to the default committed by him. Thus, in the interest of justice and fair play, we impose the cost upon the assessee for Rs. 5000/- for not presenting the appeal within the prescribed time. Accordingly, the assessee is directed to deposit cost of Rs.5000/- in the Income Tax Office,” the Tribunal said.
Noting the fact that the assessee has not appeared before the authorities, the Tribunal added that “thus it is transpired that the impugned addition has been made and sustained without considering the relevant evidence which might result in the recovery of the taxes on the additions which are not sustainable in the eyes of Law. Indeed, the primary onus lies on the assessee to co-operate in the proceedings before the authorities below. In case he does not do so he deserves to be penalized. Again, we feel that the penalty to be imposed upon the assessee should be commensurate to the default committed by him. As such we are of the view that the assessee should not suffer for his nonappearance for the addition of the income which is not sustainable under the Act,” the Tribunal said.
“We are of the view that the assessee deserves to be penalized for non-appearance before the authorities below. Accordingly, we impose the penalty of Rs.5000/- upon the assessee to deposit the same in the Income Tax Officer before the commencement of his proceedings before the AO. We further direct the assessee to co-operate in the proceedings before the AO and furnish all the requisite documents in advance before him,” it added.Subscribe Taxscan AdFree to view the Judgment