‘Medical Illness’ is a Reasonable Cause for Non-Appearance before the Authorities: ITAT Delhi Deletes Penalty [Read Order]

DRP- ITAT

In Sangeeta Sawhney v. ACIT, the ITAT, Delhi bench deleted penalty proceedings initiated under Section 271(1)(b) of the Income Tax Act by holding that medical illness is a reasonable cause for non-appearance in the course of proceedings.

In the instant case, the department levied penalty on the assessee on ground of non-compliance of notice issued by it. Against the said penalty order which was later confirmed by the first appellate authority, assessee approached the ITAT.

Before the Tribunal, assessee contended that the reason for non-appearance was due to medical illness and the penalty was levied without any basis and was without granting adequate opportunity of hearing.

Allowing the plea of the assessee, the bench observed that the Tribunal, in a similar case of the assessee for a different assessment year, concluded the matter in favour of the assessee by finding that “if there was a reasonable cause within the ambit of section 273B for 3 years for default of same notice, then no penalty u/s 271(1) (b) should be imposed. Medical illness and that to be in the nature of the typhoid fever and UTI is definitely reasonable cause for non-appearing on the date.

Read the full text of the Order below.

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