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2015 (7) TMI 329 - AT - Income TaxPenalty u/s 271(1)(c) - Condonation of delay rejected by CIT(A) and deciding the appeals on merits - Held that:- The quasi judicial authorities are being respected not on account of their power to legalise the injustice on technical ground but because, they are capable of removing injustice and is expected to do so. The contention of the assessee is that he being a lay man has handed over the papers to tax consultant who did not file appeals in time. This belief is to be tested on consequential result i.e. by making the appeal time barred what the assessee will achieve. He cannot adopt a dilatory tactics by filing the appeal late because that will ultimately harm him. Therefore, looking to the facts and circumstances and the punishment in the shape of tax liability of ₹ 48,86,903/- including interest as well as penalty of more than ₹ 24 lacs, we are of the view that the punishment is disproportionate to the ultimate negligence of the assessee. Therefore, we condone the delay in filing the appeals before the CIT(A). The assessment order and the penalty order are ex parte orders. The moment, the assessee will file any application for permission to adduce additional evidences then, as per sub-rule -3 of Rule 46A of IT Rules, 1962, the ld. first appellate authority will have to call for a remand report from the AO. The second proceeding would commence at the level of AO. Therefore, with a view to avoid multiple proceedings, we deem it appropriate to set aside the orders of CIT(A) as well as the orders of AO and remit the issues in quantum appeal to the file of AO for re-adjudication. As observed earlier we do not appreciate the conduct of assessee also. He is directed to co-operate with the AO and appear before him. He shall file all necessary details for the assessment of his income. The observations made by us will not impair or injure the case of AO and will not cause any prejudice to the defence/explanation of the assessee. The ld. AO shall provide due opportunity of hearing. As far as penalty appeal is concerned, since we have set aside the assessment order, there are no additions on which it can be alleged that assessee has evaded the taxes. After passing the assessment order, it is for the AO to assess whether penalty proceedings are to be initiated against the assessee or not. This factor would come out after completion of the assessment proceedings. Therefore, the penalty appeal is allowed and the penalty order is quashed. - Decided in favour of assessee for statistical purposes.
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