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2018 (6) TMI 408 - ITAT HYDERABADPenalty u/s 272A(1)(C) - wilful noncompliance to the summons u/s 131 - bonafide reasons for non-compliance - Held that:- Appellant had filed a letter informing that he is out of the country and will not be available till 6.6.2011. The Add. CIT has recorded this fact in the penalty order and therefore, it is not understandable as to why and how the next date of hearing was fixed on 6.6.2011 when the AO was very well aware that the appellant would not be available on that date - the appellant had reasonable cause for non-appearance before the AO on the above dates of hearing and it cannot be considered as a case of noncompliance The cause of action for levy of penalty has arisen on each date of default and the penalty of ₹ 10,000 has been levied for each date of noncompliance. Therefore, in effect, the penalty levied is only ₹ 10,000 per default and in such circumstances, it is the ITO/AO who has the power to pass the penalty order and not the Add. CIT. Therefore, we hold that the Addl. CIT had no jurisdiction to pass the penalty order in the case before us. We also find that the AR has given the explanation for reasonable cause for non-compliance of the summons u/s 131 for each day of the default. The fact that the assessment of the company was ultimately completed u/s 143(3) of the Act also proves that the assessee company has furnished the relevant details. AR has bonafide reasons for non-compliance and the AO had issued only one notice for non-compliance on three dates. - Decided in favour of assessee
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