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2017 (9) TMI 115 - AT - Income TaxPenalty u/s 271(1)(b) - alleged breach or non-compliance - failure to comply with the 2 statutory notices/date fixed for hearing - Demand in the quantum proceedings reduced to “nil” - Held that:- It is seen that nowhere the Assessing Officer has mentioned about any particulars of statutory notice/s for which there was any default on part of the assessee. Failure to comply with certain notices on a particular date was due to reasonable cause as highlighted by the assessee not only during the course of the assessment 8 proceedings but also before the Assessing Officer and Learned CIT(Appeals) in the impugned penalty proceedings and hence penalty cannot be levied in such circumstances. Demand in the quantum proceedings has been reduced to “nil”, after giving effect to the first appellate order and there has been no substantive non-compliance either during the course of the assessment proceedings or during the appellate proceedings. In such circumstances such an alleged breach or non-compliance is mere technical and venial in nature and therefore, penalty should not be levied for such venial breach. Accordingly, the levy of penalty of ₹ 20,000/- u/s 271(1)(b) for all the assessment years is unsustainable for the reasons given above and is directed to be deleted. Thus, grounds raised by the assessee are allowed.
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