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2017 (9) TMI 1352 - AT - Income TaxPenalty u/s 271(1)(b) - reasonable cause for failure to comply with the notices - proceedings u/s 153A - proof of meaningful compliance of notices at the assessment proceedings u/s 153A - Held that:- CIT(A) instead of considering the explanation of assessee in proper perspective, proceeded on different reasoning to reject the appeals of the assessee that settlement applications have been subsequently on 25.02.2014 after issue of the above two notices. When complete seized documents have not been provided to assessee and some of the seized documents provided were not legible, the assessee may not be able to file return of income u/s 153A of the Income Tax Act. Therefore, there is no question of assessee making meaningful compliance of notices at the assessment proceedings u/s 153A read with section 143(3) of the Act Income Tax Act. The explanation of the assessee have not been appreciated by the Ld. CIT(A), therefore, explanation of assessee shall be considered favourable to hold that there appears reasonable cause for the assessee for the non compliance of both the notices. Section 273B of the Income Tax Act provides that no penalty shall be imposable on the person or the assessee, as the case may be, for any failure referred to section 271(1)(b) of the Act, if assessee proves that there was a reasonable cause for the said failure. The explanation of assessee clearly proves that there were a reasonable cause for failure to comply with the notices. Therefore, on such circumstances the penalty u/s 271(1)(b) for all the years cannot be sustained. We set aside the orders of authority below and cancel the penalty in all the assessment years. - Decided in favour of assessee.
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