Late Jitender Sapra (Through wife Anjali Sapra), New Delhi V. ITO WARD 50(4), New Delhi

ITA 2109/DEL/2019

AI Insights

The case involves an appeal by the legal heir of Late Sh. Jitender Sapra against a penalty imposed by the Income Tax Officer for non-compliance with statutory notices. The assessee had filed a return declaring an income of Rs.1,95,340 for the assessment year 2008-09, which was processed under section 143(1) of the Income Tax Act. The Assessing Officer imposed a penalty citing non-compliance with several notices. The legal heir contested the penalty, arguing that the assessee was unable to comply due to severe illness and had passed away before the notices could be addressed. The Tribunal, considering the circumstances and the provisions of section 273B, ruled in favor of the assessee, highlighting the reasonable cause for non-compliance due to the assessee's health condition and death.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 131760 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 1 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-04-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 13-02-2023
• Assessment Year: 2008-2009
• Appeal Filed On: 10-03-2019
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Reasonable cause
• Section: 27; 273B; 142(1); 143(2)

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL DELHIBENCH ‘C’, NEW DELHI Before Sh. C. M. Garg, Judicial Member Dr. B. R. R. Kumar, Accountant Member ITA No. 2109/Del/2019 : Asstt. Year: 2008-09 Late Sh. Jitender Sapra (through L/H Smt. Anjali Sapra), C/o J. L. Sethi, Adv., 227-28, Anarkali Complex, Jhandewalan Extension, New Delhi-110055 Vs. Income Tax Officer, Ward-50(4), New Delhi (APPELLANT) (RESPONDENT) PAN No. AUJPS2662R Assessee by : Sh. V. K. Sabharwal, Adv. Revenue by : Sh. Anuj Garg, Sr. DR Date of Hearing: 14.02.2023 Date of Pronouncement: 25.04.2023 ORDER Per Dr. B. R. R. Kumar, Accountant Member: The present appeal has been filed by assessee against the order of the ld. CIT(A)-17, New Delhi dated 03.08.2018. 2. Following grounds have been raised by the assessee: “1 . T ha t t he pe na l ty o r de r pa sse d o n 2 8 .0 9 .2 0 1 6 u /s 2 7 1 (1 ) ( b) o f the Act by t he As se ss in g O ff i ce r aga ins t the de ce ase d as se sse e a s u p he l d b y t he L d . C I T (A ) , ar e pe r ve r se to t he pr o v is io ns o f law a n d to t he f ac ts o f the c ase , as t he a sse sse e ha s alr e a d y e x p ir e d afte r hi s pr o lo n ge d i ll n e ss o n 2 2 .1 2 .2 0 1 5 . 2 . T ha t t he pe n al ty o r de r pa s se d is f ur t he r un co n s ti t ut io na l as a ga in s t t he l a w an d to t he fa c ts o f the case , be ca u se as pe r the p r o vi sio n s o f l aw la id do w n u / s 2 7 1 (1 ) (b ) r e ad w it h Se c t io n 2 (3 1 ) o f t he Ac t , ITA No. 2109/Del/2019 Late Sh. Jitender Sapra 2 the pe n a lt y ca n no t be im po se d o n a ny o f t he L e ga l He ir o f t he de ce a se d a ppe l la nt . 3 . T ha t the le v y o f pe na l ty u /s 2 7 1 (1 ) ( b ) o f the Ac t w as fur t he r u nc o ns t it u ti o n al be cau se the As se ss in g O ff ice r w a s no t hav i ng a ny r e co r d fo r the r e ce i pt / se r v ice o f a ny no t i ce s c l ai me d to be i ss ue d to the de ce a se d a sse s s e e S h. Ji te ndr a S apr a . 4 . T ha t the Asse s si ng O ff ice r fa il e d to a p pr e c ia te w h ile im po s i ng the pe na l ty o f R s. 6 0 0 0 0 / - o n t he de ce a se d as se ss e e u/ s 2 7 1 (1 ) ( b) o f the Ac t , th at be ca use o f the no n -r e ce ip t /se r vi ce o f the r e l e van t no t i ce to t he de ce ase d, the ca se i s co ve r e d u/ s 2 7 3A o f t he I nco me T ax Ac t 1 9 6 1 , as the as se sse e ha s alr e a d y e x p ir e d o n 2 2 .1 2 .2 0 1 5 . 5 . T ha t the pe n al t y o r de r p asse d u/ s 2 7 1 (1 )( b ) o f the A ct w a s fu r the r i l le g a l be c ause t he sa me w as le v ie d w i t ho u t fo l lo w in g t he pr o p e r law a n d pr o ce dur e la i d do w n un de r t he Ac t . 6 . T ha t the pe n a l ty o r de r pa sse d is f ur the r no t te n ab le be ca u s e the sa me i s s i le n t , fo r w h ic h par t ic ul ar da te t he a p pe l la n t ha s fa i le d to co m pl y w i t h the sa i d no ti ce , fo r w hi ch t he co nso l id ate d pe n a lt y o f R s. 6 0 0 0 0 / - w as le v ie d . 7 . T ha t t he A sse s s in g O ff i ce r ha s f ur t he r fa i le d to ap pr e c ia te t ha t aga in s t t he de ce a se d pe r so n no pe n al t y if a ny is l e vi ab le as co ve r e d u /s 1 5 9 to u/s 1 6 2 o f the In co me T ax Ac t 1 9 6 1 , a s t he L e g al He ir sha l l o nl y be l i ab le to pay t he d ue t ax if a ny be a ppe a r s to be pa ya ble by t he de ce a se d to the e x te nt o f a s se t s in he r ite d b y the m, a fte r hi s/ he r de a th .” ITA No. 2109/Del/2019 Late Sh. Jitender Sapra 3 3. The assessee filed return of income on 06.09.2008 declaring an income of Rs.1,95,340/- which was processed u/s 143(1) of the Income Tax Act, 1961. The Assessing Officer has imposed a penalty of Rs. 60,000/- under section 271(1)(b) of Income Tax Act in this case. The AO pointed out in the penalty order that the assessee failed to comply with notices as mentioned below: S.No Description of Notice Date of Notice Date of hearing Remarks 1. U/s 143(2) 04.08.2015 17.08.2015 AO filed POA on 12.08.2015 but failed to file any details on 17.08.2015 2. U/s 142(1) 26.08.2015 07.09.2015 No compliance was made 3. U/s 142(1) 15.10.2015 21.10.2015 No compliance was made 4. 29.10.2015 AR appeared and filed a letter seeking adjournment. On his request, case adjourned to 05.11.2015 5. Adjournment 05.11.2015 No compliance was made 6. U/s 142(1) 15.12.2015 21.12.2015 No compliance Way made 7. U/s 142(1) 29.12.2015 04.01.2016 AR attended and sought adjournment for 07.01.2016 8. U/s 142(1) Adjournment 07.01.2016 No compliance was made 9. U/s 142(1) 08.01.2016 15.01.2016 No compliance was made 10. U/s 142(1) 18.01.2016 27.01.2016 No compliance was made 11. U/s 142(1) 28.01.2016 04.02.2016 No compliance was made 12 01.02.2016 AR attended and filed Death Certificate with POA of L/H 13. U/s 142(1) 08.02.2016 15.02.2016 AR filed a letter seeking adjournment and case is adjourned to 19.02.2016. 14. Adjournment 19.02.2016 No compliance was made 4. The Revenue argued that notices so issued by the Department were not complied by the assessee, Sh. Jitender Sapra or the Authorized Representative or by the legal heir Smt. Anjali Sapra on 29.12.2015 onwards. The ld. AR argued that the assessee could not reply to the notices as he remained hospitalized due to cancer and has expired on 22.12.2015. ITA No. 2109/Del/2019 Late Sh. Jitender Sapra 4 5. The provisions of Section 273B reads as under: “Penalty not to be imposed in certain cases. 2 7 3 B . N o t w i t h s t a n d i n g a n y t h i n g c o n t a i n e d i n t h e p r ov i s i o n s o f c l a u s e ( b ) o f s u b - s e c t i o n ( 1 ) o f s e c t i o n 2 7 1 , s e c t i o n 2 7 1 A , s ec t i o n 2 7 1 A A , s e c t i o n 2 7 1 B , s e c t i o n 2 7 1 B A , s e c t i o n 2 7 1 B B , s e c t i o n 2 7 1 C , se c t i o n 2 7 1 C A , s e c t i o n 2 7 1 D , s e c t i o n 2 7 1 E , s e c t i o n 2 7 1 F , s e c t i o n 2 7 1 F A , s ec t i o n 2 7 1 F A B , s e c t i o n 2 7 1 F B , s e c t i o n 2 7 1 G , s e c t i o n 2 7 1 G A , s e c t i o n 2 7 1 G B , s e c t i o n 2 7 1 H , s e c t i o n 2 7 1 - I , s e c t i o n 2 7 1 J , c l a u s e ( c ) o r c l a u s e ( d ) o f s ub - s e c t i o n ( 1 ) o r s u b - s e c t i o n ( 2 ) o f s e c t i o n 2 7 2 A , s u b - s e c t i o n ( 1 ) o f s e ct i o n 2 7 2 A A o r s e c t i o n 2 7 2 B o r s u b - s e c t i o n ( 1 ) o r s u b - s e c t i o n ( 1 A ) o f s e c ti o n 2 7 2 B B o r s u b - s e c t i o n ( 1 ) o f s e c t i o n 2 7 2 B B B o r c l a u s e ( b ) o f s u b -s e c t i o n ( 1 ) o r c l a u s e ( b ) o r c l a u s e ( c ) o f s u b - s e c t i o n ( 2 ) o f s e c t i o n 2 7 3 , n o p e n a l t y s h a l l b e i m p o s a b l e o n t h e p e r s o n o r t h e a s s e s s e e , a s t h e c a se m a y b e , f o r a n y f a i l u r e r e f e r r e d t o i n t h e s a i d p r o v i s i o n s i f h e p ro v e s t h a t t h e r e w a s r e a s o n a b l e c a u s e f o r t h e s a i d f a i l u r e . ” 6. Section 273B does provide that the penalty is not to be imposed if the assessee has reasonable cause for non- compliance. Hence, in keeping in view, the provisions of Section 273B, we hold that the assessee had a reasonable cause for the said failure and hence no penalty shall be imposable. 7. In the result, the appeal of the assessee is allowed. Order Pronounced in the Open Court on 25/04/2023. Sd/- Sd/- (C. M. Garg) (Dr. B. R. R. Kumar) Judicial Member Accountant Member Dated: 25/04/2023 *Subodh Kumar, Sr. PS* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR