Penalty u/s 271A(1)(d) of Income Tax Act shall not be Levied,  if Assessee Shows Reasonable Cause for Non compliance of Statutory Notices: ITAT [Read Order]

The Income Tax Appellate Tribunal (ITAT) Delhi bench held that the penalty under Section 271A(1)(d) of Income Tax Act, 1961 should not be levied if the assessee shows the reasonable cause for non compliance of the statutory notices. The Assessing officer did not accept submission of the assessed penalty.

Assessee, Bijender Lather assessment order was completed under Section 144 of the Income-Tax Act. During the assessment proceedings the Assessing Officer initiated penalty proceedings for non compliance of the statutory notices. Thereafter the AO imposed a penalty of Rs. 20,000/- for non-compliance of the notices

Aggrieved by the order, the assessee filed an appeal  before the Commissioner of Income Tax (Appeals)[ CIT(A)], who dismissed the appeal. Thereafter the assessee filed a second appeal before the tribunal.

Before the bench no one appeared for the assessee ,even though by considering the written submission the assessee submitted that AO did not mention the date of notice for which penalty was initiated. The AO mentioned “notice” means only one notice. This notice under Section 142(1) of the Income Tax Act was not received by  the assessee.

Assessee  further argued that the assessee has no taxable income, in order to be liable to comply with the obligation of filing a return of income under Section 139(1) of the Income Tax Act.Thus no penalty should be levied.

Om Parkash,  Counsel for Revenue, supported the decision of lower authorities.

 It was observed by the tribunal that in response to the penalty notice the assessee had filed a certain explanation before the Assessing Authority. However, the Assessing Authority did not consider the same.Thus  If the assessee could show the reasonable cause for non-compliance, in that event the AO should not levy the penalty.

After reviewing the facts and submissions of the both parties, the single member bench of Kul Bharat, (Judicial Member) held that  penalty under Section 271A(1)(d) of Income Tax Act, 1961 should not be levied if the assessee shows the reasonable cause for non compliance of the statutory notices.

To Read the full text of the Order CLICK HERE

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