Kamleshkumar Shankarbhai Patel, Sabarkantha V. The Income Tax Officer, Ward-1, Himatnagar

ITA 26/AHD/2023

AI Insights

The case involves Kamleshkumar Shankarbhai Patel, the appellant, who faced penalties for non-compliance with notices issued under Section 142(1) of the Income Tax Act during the assessment years 2013-14 to 2016-17. The notices were allegedly not received by the assessee, leading to an ex-parte assessment and subsequent penalties. The CIT(A) upheld the penalties, which were contested in the Income Tax Appellate Tribunal. The tribunal found that the notices were not properly served, as there was no evidence of service completion such as an acknowledgment card, leading to the decision to allow the appeals and remove the penalties.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 299948 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-03-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 13-03-2023
• Assessment Year: 2013-2014
• Appeal Filed On: 10-01-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 147; 144; 142(1); 274; 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, AHMEDABAD BEFORE MS. SUCHITRA KAMBLE, JUDICIAL MEMBER I .T .A . N o s . 2 6 t o 2 9/ A h d /2 02 3 ( A s s e s s me nt Y ea r s : 2 0 13 -1 4 to 2 01 6 - 1 7) Ka mle s h ku ma r S h a n ka rb ha i Pa te l Kh er o l, T a l od S ab a r ka nt ha Gu j ar a t -3 83 2 1 5 Vs . I T O War d - 1 , H i mm a t na ga r , Sa b a r ka nt ha , G uj ar a t [P AN N o.A N VP P 5 07 4F] (Appellant) .. (Respondent) Appellant by : Ms. Arti N. Shah, A.R. Respondent by: Shri R. R. Makwana, Sr. D.R. D a t e of H ea r i ng 14.03.2023 D a t e of P r o no u n ce me nt 24.03.2023 O R D E R These four appeals filed by the same assessee are against the order passed by the Ld. CIT(Appeals), National Faceless Appeal Centre (in short “NFAC”), Delhi on 14.11.2022 for A.Ys. 2013-14 to 2016-17. ITA No. 26/Ahd/2023 (A.Y. 2013-14):- 2. The grounds of appeal raised by the assessee are common in all the appeals so we reproduce only ITA No. 26/Ahd/2023 grounds of appeal are as under: “1. The Learned Commissioner of Income Tax (Appeals) has erred in law and on facts of the case by confirming penalty of Rs.30,000/- levied by the learned Assessing Officer u/s.271(1)(b) of the I.T. Act, 1961. 2. Your Appellant, therefore, prays to delete the penalty of Rs.30,000/- levied u/s.271(1)(b) of the I.T. Act, 1961 by the learned Assessing Officer. 3. Your Appellant reserves the right to add, alter, amend and/or withdraw any of the above Grounds of Appeal.” ITA Nos. 26to29/Ahd/2023 Kamleshkumar Shankarbhai Patel vs. ITO Asst.Years–2013-14 to 2016-17 - 2 – 3. All these appeals are identical and therefore, facts of A.Y. 2013-14 is taken up first. The Assessee is an individual. The case was selected for scrutiny because of the initiation of proceedings u/s 147 and was issued notice from the Department from time to time. During the course of assessment proceedings, notices u/s 142(1) of the Income Tax Act, 1961 dated 15.07.2019, 11.10.2019 and 21.11.2019 were issued to the assessee. But the assessee did not complied with the notices and not filed any response to the notices. The Assessing Officer passed order under Section 144 r.w.s. 147 of the Act dated 04.12.2019. As there was no response/compliance to the notices, penalty proceeding u/s 271(1)(b) r.w.s. 274 of the Act dated 04.12.2019 and 26.02.2021 were issued by the Assessing Officer. In response to these notices, assessee submitted his replies dated 19.12.2019 and 05.03.2021. The Assessing Officer rejected the contention of the assessee and levied penalty of Rs. 30,000/- u/s 271(1)(b) of the Act. 4. Being aggrieved by the Penalty order, the assessee filed appeal before the CIT(A). The CIT(A) dismissed the appeal of the assessee. 5. The Ld. AR submitted that the assessee is an individual staying in a mofussil place called Kherol, Talod, District: Sabarkantha in Gujarat. The Ld. AR submitted that the assessee notices issued u/s 142(1) of the Act was not received by the assessee at any point of time either by mail or by post. The Assessing Officer has passed ex-parte assessment order. The ld. AR further submitted that the assessee received the penalty notices dated 04.12.2019 and 26.02.2021 and responded the same. Since ITA Nos. 26to29/Ahd/2023 Kamleshkumar Shankarbhai Patel vs. ITO Asst.Years–2013-14 to 2016-17 - 3 – the notices issued u/s 142(1) of the Act were not received by the assessee, the assessee could not respond the same at the time of assessment proceedings. The aspect of service of notice to the assessee was not mentioned either in the assessment order or in the penalty order. Therefore, the penalty order is not justifiable. 6. The Ld. DR relied upon the assessment order and the order of the CIT(A). 7. Heard both the parties and perused all the relevant material available on record. It is pertinent to note that the assessment order is mentioning that notice u/s 142(1) was issued and mode of service was through mail and by post, but there was no mention of the completion of the service of notice to the assessee through mail or by post. There is no mention of any acknowledgement card (postal A.D.) details in the assessment order. The Assessing Officer during the penalty proceedings u/s 271(1)(b) has also not verified the same. Merely stating that the notice was issued and served to the assessee without giving any details of the completion of service of the statutory notice in the respective orders, will not be sufficient for invoking Section 271(1)(b) of the Act. The Assessing Officer as well as the CIT(A) has not looked into this aspect. From the perusal of the details it appears that the assessee did not receive the notices and therefore, the penalty imposed u/s 271(1)(b) of the Act does not survive. Thus, appeal being ITA No. 26/Ahd/2023 filed by the assessee for A.Y. 2013-14 is allowed. ITA Nos. 26to29/Ahd/2023 Kamleshkumar Shankarbhai Patel vs. ITO Asst.Years–2013-14 to 2016-17 - 4 – 8. As regards to ITA Nos. 27, 28, 29/Ahd/2023 for A.Y. 2014-15, 2015-16 and 2016-17 are identical to that of A.Y. 2013-14, therefore all these appeals are also allowed. 9. In result, all the four appeals filed by the assessee are allowed. This Order pronounced in Open Court on 24/03/2023 Sd/- (SUCHITRA KAMBLE) JUDICIAL MEMBER Ahmedabad; Dated 24/03/2023 TANMAY, Sr. PS TRUE COPY आदेश क त ल प अ े षत/Copy of the Order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent. 3. संबं धत आयकर आय ु त / Concerned CIT 4. आयकर आय ु त(अपील) / The CIT(A)- 5. वभागीय त न ध, आयकर अपील!य अ धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड' फाईल / Guard file. आदेशान ु सार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपील य अ धकरण, अहमदाबाद / ITAT, Ahmedabad 1. Date of dictation 22.03.2023 (Typed in her own computer) 2. Date on which the type draft is placed before the Dictating Member 22.03.2023 3. Other Member..................... 4. Date on which the approved draft comes to the Sr.P.S./P.S .03.2023 5. Date on which the fair order is placed before the Dictating Member for pronouncement .03.2023 6. Date on which the fair order comes back to the Sr.P.S./P.S 24.03.2023 7. Date on which the file goes to the Bench Clerk 24.03.2023 8. Date on which the file goes to the Head Clerk.......................................... 9. The date on which the file goes to the Assistant Registrar for signature on the order.......................... 10. Date of Despatch of the Order..........................................