NORMA LYDIA AYYASH, MUMBAI V. INCOME TAX OFFICER WARD 24(3)(2), MUMBAI

ITA 2758/MUM/2022

AI Insights

The case involves two appeals by Norma Lydia Ayyash against penalties levied under sections 271F and 271(1)(b) of the Income-tax Act, 1961, for non-filing of income tax returns and non-compliance during the assessment proceedings, respectively. The Income Tax Officer (ITO) had initiated reassessment proceedings based on information regarding unreported income and non-filing of returns. The assessee failed to comply with the notices issued during the reassessment, leading to a best judgment assessment and the imposition of penalties. The appeals were initially filed in physical format but were later filed electronically after the CIT(A) pointed out deficiencies, leading to the dismissal of the physical appeals.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 123169 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-12-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 25-12-2022
• Assessment Year: 2010-2011
• Appeal Filed On: 27-10-2022
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: SAURABH V. BHATT
• Keywords: Reassessment proceedings; TDS
• Section: 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “B” MUMBAI BEFORE SHRI ABY T VARKEY (JUDICIAL MEMBER) AND SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) ITA No. 2758/MUM/2022 Assessment Year: 2010-11 & ITA No. 2759/MUM/2022 Assessment Year: 2010-11 Norma Lydia Ayyash, 15, Goundowli, Andheri East, Mumbai-400069. Vs. ITO-24(3)(2), Aayakar Bhavan, Mumbai-400 005. PAN No. AKIPA 4487 B Appellant Respondent Assessee by : Mr. Saurabh V. Bhatt Revenue by : Mr. Chetan M. Kacha, DR Date of Hearing : 26/12/2022 Date of pronouncement : 29/12/2022 ORDER PER OM PRAKASH KANT, AM These two appeals by the assessee are directed against two separate orders both dated 29.08.2022 passed by the Ld. Commissioner of Income-tax (Appeals)-55, Mumbai, [in short ‘the Ld. CIT(A)’] in relation to penalty levied u/s 271F of the Income-tax Act, 1961 (in short ‘the Act’) for non-filing of return of income and penalty u/s 271(1)(b) of the Act for non during the assessment proceedings 2. In the grounds raised in both these appeals, the assessee is aggrieved with dismissal of the physically filed CIT(A). 3. We have heard rival submission of the parties on the issue dispute and perused the relevant material on record. In view of the information available on Income relation to TDS of ₹2,37,156/ cash deposit of ₹10,00,000/ information of no return of income filed by the Assessing Officer recorded reasons to believe assessment and commenced reassessment proceedings by way of issue of notice u/s 148 of the Act. No compliance of the notices issued by the Assessing Officer was made and therefore, the Assessing Officer completed of the Act i.e. best judgment assessment and made addition of ₹33,90,670/-. In the assessment order, the Assessing Officer also issued penalty u/s 271F for non Assessing Officer also issued notices for levying penalty u 271(1)(b) of the Act for non of notices issued during the assessment proceedings. The Assessing Officer levied penalty of penalty u/s 271(1)(b) of the Act for non-complying notice issued during the assessment proceedings, respectively. In the grounds raised in both these appeals, the assessee is dismissal of the physically filed appeal We have heard rival submission of the parties on the issue dispute and perused the relevant material on record. In view of the information available on Income-tax Portal, interalia 2,37,156/- insurance premium of 10,00,000/- and time deposit of ₹18,53,532/ no return of income filed by the Assessing Officer recorded reasons to believe that income commenced reassessment proceedings by way of issue of notice u/s 148 of the Act. No compliance of the notices issued by the Assessing Officer was made and therefore, the completed the assessment in terms of section of the Act i.e. best judgment assessment and made addition of . In the assessment order, the Assessing Officer also issued penalty u/s 271F for non-filing of return of income. The Assessing Officer also issued notices for levying penalty u 271(1)(b) of the Act for non-filing of the basic information in respect of notices issued during the assessment proceedings. The Assessing Officer levied penalty of ₹5,000/- u/s 271F vide order dated Norma Lydia Ayyash ITA No. 2758 & 2759/M/2022 2 complying notice issued In the grounds raised in both these appeals, the assessee is appeal by the Ld. We have heard rival submission of the parties on the issue-in- dispute and perused the relevant material on record. In view of the interalia, income in in insurance premium of ₹3,00,000/-, 18,53,532/- and no return of income filed by the assessee, the income escaped commenced reassessment proceedings by way of issue of notice u/s 148 of the Act. No compliance of the notices issued by the Assessing Officer was made and therefore, the the assessment in terms of section 144 of the Act i.e. best judgment assessment and made addition of . In the assessment order, the Assessing Officer also filing of return of income. The Assessing Officer also issued notices for levying penalty u/s filing of the basic information in respect of notices issued during the assessment proceedings. The Assessing u/s 271F vide order dated 27.12.2017 and penalty same date. 3.1 Aggrieved, the assessee filed appeal on 18.11.2018 format in old Form No. 35 the penalties. The Ld. CIT(A) pointed out certain deficiencies in the appeal filed and directed the per the relevant Rules. The assessee complied and filed appeal in the electronic format on 14.08.2022. In view of electronic filing of the appeals, the Ld. CIT(A) dismissed these appeals which were filed in physical format. identical and therefore of the Ld. CIT(A) in ITA NO. 2758/M/2022 in respect of penalty levied u/s 271F, as under: “4. Findings The appellant has sought to file 271F dated 27.12.2017. The appeal was to be electronically filed on departmental portal within 30 days of the date of receipt of the penalty order i.e. 02.01.2018. However, the appellant has filed manual appeal on 19.01.2018. As p response of the appellant to the deficiency letter, she has filed another appeal electronically on 14.08.2022 (which has been taken up separately for adjudication). 4.1 It is noted that the Central Board of Direct Taxes vide Income tax (3rd Amendmen Rule 45 and Form No.35 in Notification No. SO637(E) dated 27.12.2017 and penalty of ₹10,000/- u/s 271(1)(b) of Aggrieved, the assessee filed appeal on 18.11.2018 in old Form No. 35 before the Ld. CIT(A) in respect of both The Ld. CIT(A) pointed out certain deficiencies in the appeal filed and directed the assessee to file the appeal online as per the relevant Rules. The assessee complied and filed appeal in format on 14.08.2022. In view of electronic filing of , the Ld. CIT(A) dismissed these appeals which were filed ormat. The fact narrated in both these appeals are identical and therefore, for brevity, we are reproducing the finding A) in ITA NO. 2758/M/2022 in respect of penalty levied u/s 271F, as under: 4. Findings The appellant has sought to file appeal against order us. 271F dated 27.12.2017. The appeal was to be electronically filed on departmental portal within 30 days of the date of receipt of the penalty order i.e. 02.01.2018. However, the appellant has filed manual appeal on 19.01.2018. As p response of the appellant to the deficiency letter, she has filed another appeal electronically on 14.08.2022 (which has been taken up separately for adjudication). 4.1 It is noted that the Central Board of Direct Taxes vide Income tax (3rd Amendment) Rules, 2016 - substitution of Rule 45 and Form No.35 in Notification No. SO637(E) dated Norma Lydia Ayyash ITA No. 2758 & 2759/M/2022 3 u/s 271(1)(b) of the Act on Aggrieved, the assessee filed appeal on 18.11.2018 in physical before the Ld. CIT(A) in respect of both The Ld. CIT(A) pointed out certain deficiencies in the assessee to file the appeal online as per the relevant Rules. The assessee complied and filed appeal in format on 14.08.2022. In view of electronic filing of , the Ld. CIT(A) dismissed these appeals which were filed both these appeals are we are reproducing the finding A) in ITA NO. 2758/M/2022 in respect of penalty appeal against order us. 271F dated 27.12.2017. The appeal was to be electronically filed on departmental portal within 30 days of the date of receipt of the penalty order i.e. 02.01.2018. However, the appellant has filed manual appeal on 19.01.2018. As per the response of the appellant to the deficiency letter, she has filed another appeal electronically on 14.08.2022 (which has 4.1 It is noted that the Central Board of Direct Taxes vide substitution of Rule 45 and Form No.35 in Notification No. SO637(E) dated 01.03.2016 made it mandatory to file appeal in Form No. 35 in an electronic manner. The case of the appellant is covered by the said notification. Thus, the appellan e-file the above appeal (which has been done subsequently as also seen from appeal records) and therefore, this manual appeal filed by the appellant on 19.01.2018 is rendered void and liable to be dismissed for statistical purposes. 5. In view of the above, the appeal is dismissed. 4. The issue-in-dispute before us is whether the assessee was required to file the appeal in online format or in physical format find that the Central Board of Direct Taxes in this respect has amended the Rule 45 and Form No. 35 by way of Notification No. SO637(E) dated 01.03.2016. The amended Rule 45(1) & (2) is reproduced for rea reference: “45. Form of appeal to Commissioner (Appeals). appeal to the Commissioner (Appeals) shall be made in Form No. 35. (2) Form No. 35 shall be furnished in the following manner, namely:- (a) in the case of a person who is required to furni of income electronically under sub (i) by furnishing the form electronically under digital signature, if the return of income is furnished under digital signature; 01.03.2016 made it mandatory to file appeal in Form No. 35 in an electronic manner. The case of the appellant is covered by the said notification. Thus, the appellant was required to file the above appeal (which has been done subsequently as also seen from appeal records) and therefore, this manual appeal filed by the appellant on 19.01.2018 is rendered void and liable to be dismissed for statistical purposes. view of the above, the appeal is dismissed.” dispute before us is whether the assessee was required to file the appeal in online format or in physical format find that the Central Board of Direct Taxes in this respect has amended the Rule 45 of Income-tax Rules 1962 (in short ‘the Rules’) and Form No. 35 by way of Notification No. SO637(E) dated 01.03.2016. The amended Rule 45(1) & (2) is reproduced for rea 45. Form of appeal to Commissioner (Appeals). appeal to the Commissioner (Appeals) shall be made in Form No. 35. (2) Form No. 35 shall be furnished in the following manner, (a) in the case of a person who is required to furni of income electronically under sub-rule(3) of rule 12, (i) by furnishing the form electronically under digital signature, if the return of income is furnished under digital Norma Lydia Ayyash ITA No. 2758 & 2759/M/2022 4 01.03.2016 made it mandatory to file appeal in Form No. 35 in an electronic manner. The case of the appellant is covered t was required to file the above appeal (which has been done subsequently as also seen from appeal records) and therefore, this manual appeal filed by the appellant on 19.01.2018 is rendered void and liable to be dismissed for statistical purposes. dispute before us is whether the assessee was required to file the appeal in online format or in physical format. We find that the Central Board of Direct Taxes in this respect has tax Rules 1962 (in short ‘the Rules’) and Form No. 35 by way of Notification No. SO637(E) dated 01.03.2016. The amended Rule 45(1) & (2) is reproduced for ready 45. Form of appeal to Commissioner (Appeals).-(1) An appeal to the Commissioner (Appeals) shall be made in (2) Form No. 35 shall be furnished in the following manner, (a) in the case of a person who is required to furnish return rule(3) of rule 12,- (i) by furnishing the form electronically under digital signature, if the return of income is furnished under digital (ii) by furnishing the form electronically through electronic verification code in a (b in a case where the assessee has the option to furnish the return of income in paper form, by furnishing the form electronically in accordance with clause (a) of sub* rule(2) or in paper for 4.1 Thus, the option of filing the appeal in paper form was available only if the assessee had option of filing return of income in paper form. 4.2 However, we find that the assessee has already upload appeal in electronic format and the Ld. CIT(A) that those appeal filed electronically has been taken up separately for adjudication and he only for avoiding duplica any error in the order of the Ld. C However, we may like to mention that if there is any delay in filing the appeals in electronic format those appeals should be taken for adjudication. The assessee cannot be left without rem and either of the appeals adjudicated by the Ld. CIT(A). 4.4 In view of the above, the appeals filed by the assessee are disposed off. (ii) by furnishing the form electronically through electronic verification code in a case not covered under sub-clause (i); (b in a case where the assessee has the option to furnish the return of income in paper form, by furnishing the form electronically in accordance with clause (a) of sub* rule(2) or in paper form.” Thus, the option of filing the appeal in paper form was available only if the assessee had option of filing return of income in However, we find that the assessee has already upload in electronic format and the Ld. CIT(A) has also mentioned that those appeal filed electronically has been taken up separately for adjudication and he has dismissed the appeals in paper form duplicacy of the appeals. Therefore, we do not any error in the order of the Ld. CIT(A) in dismissing the appeals. However, we may like to mention that if there is any delay in filing the appeals in electronic format, then delay might be condoned and those appeals should be taken for adjudication. The assessee cannot be left without remedy of appeal against the penalty levied and either of the appeals whether online or paper form adjudicated by the Ld. CIT(A). In view of the above, the appeals filed by the assessee are Norma Lydia Ayyash ITA No. 2758 & 2759/M/2022 5 (ii) by furnishing the form electronically through electronic clause (i); (b in a case where the assessee has the option to furnish the return of income in paper form, by furnishing the form electronically in accordance with clause (a) of sub* rule(2) Thus, the option of filing the appeal in paper form was available only if the assessee had option of filing return of income in However, we find that the assessee has already uploaded has also mentioned that those appeal filed electronically has been taken up separately the appeals in paper form y of the appeals. Therefore, we do not find IT(A) in dismissing the appeals. However, we may like to mention that if there is any delay in filing then delay might be condoned and those appeals should be taken for adjudication. The assessee edy of appeal against the penalty levied whether online or paper form has to be In view of the above, the appeals filed by the assessee are 5. In the result, the appeals filed by the assessee are dismissed. Order pronounced 1963 on 29/12/2022. Sd/- (ABY T VARKEY JUDICIAL MEMBER Mumbai; Dated: 29/12/2022 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to 1. The Appellant 2. The Respondent. 3. The CIT(A)- 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. //True Copy// In the result, the appeals filed by the assessee are dismissed. Order pronounced under Rule 34(4) of the ITAT Rules, /2022. Sd/- ABY T VARKEY) (OM PRAKASH KANT JUDICIAL MEMBER ACCOUNTANT MEMBER Copy of the Order forwarded to : BY ORDER, (Sr. Private Secretary) ITAT, Mumbai Norma Lydia Ayyash ITA No. 2758 & 2759/M/2022 6 In the result, the appeals filed by the assessee are dismissed. under Rule 34(4) of the ITAT Rules, - OM PRAKASH KANT) ACCOUNTANT MEMBER BY ORDER, (Sr. Private Secretary) ITAT, Mumbai