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TMI Blog2015 (6) TMI 715X X X X Extracts X X X X X X X X Extracts X X X X ..... sed under section 271(1)(b) of the Income Tax Act, 1961(the Act). In all these cases facts are identical and these appeals were disposed of by Ld. CIT(A) by a consolidated order. 3. The penalty order in each of the case is same and for the sake of clarity the order is reproduced below: "Penalty Order u/s. 271(1)(b) r.w.s. 274 of the I.T.Act, 1961. In the case notice u/s. 142(1) of the I.T. Act, 1961 was issued to you on 05/02/2013 and was duly served, requiring you to attend personally and give evidence on 12/02/2013 at 11.30 AM. But there was neither compliance, nor anybody filed complete details nor sought any adjournment to the said notice. In view of above, the penalty u/s. 271(1)(b) r.w.s. 274 of IT Act 1961 is hereby initiated. Penalty u/s.271(1)(b) levied of Rs. 10,000/- Issue demand notice accordingly." 3.1 Thus it can be seen from the above order that firstly, on the basis of notice issued under section 142(1) of the Act impugned penalty has been imposed and secondly, the failure of the assessee was to attend the date given in the notice under section 142(1) on 12/2/2013. 3.2 The assessee objected the levy of penalty in the appeal filed before Ld. CIT(A) on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ural justice. It was further held by Ld. CIT(A) that those observations regarding section 271(1)(b) were in the notice issued under section 142(1) of the Act dated 28/1/2013 and not for the non-compliance of notice dated 5/2/2013. Thus, it was submitted by Ld. AR that Ld. CIT(A) has committed an error in sustaining the penalty and in absence of show cause notice for levy of penalty, the penalty should have been deleted. 5. On the other hand, relying upon the order passed by Ld. CIT(A) it was submitted by Ld. DR that assessee was clearly informed that non-compliance of notice under section 142(1) of the Act would result into the levy of penalty under section 271(1)(b) of the Act and this was sufficient compliance with the provisions of section 274(1) of the Act and, therefore, Ld. CIT(A) was right in sustaining the penalty and his order should be upheld. 6. We have heard both the parties and their contentions have carefully been considered. It may be mentioned here that we have carefully gone through the assessment orders for all the years to ascertain the default of the assessee for which the impugned penalty has been imposed. The default of the assessee as mentioned in the impug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of this notice was fixed on 29.10.2012, but on the designated date no one attended, nor had any adjournment letter been filed. 7. In view of consistent non-compliance on the part of the assessee more reminder notice u/s. 142(1) dated 29.10.2012 was issued and duly served on the assessee. In this notice the assessee was asked to show cause that if the assessee fails to attend the hearing with all details then why the assessment should not be completed u/s.144 of the income Tax Act, 1961. Further it was mentioned that, if is the last opportunity of being heard, and further the assessment will be completed ex-parte without further notice. The date for hearing was fixed on 06.11.2012, but on the designated date no one attended. 8. In view of consistent non-compliance on the part of the assessee one more reminder notice u/s.142(1) dated 7/12/2012 was issued and duly served on the assessee. In this notice the assessee was asked to show cause that if the assessee fails to attend the hearing with all details then why the assessment should not be completed u/s.144 of the Income Tax Act, 1961. Further it was mentioned that, it is the last opportunity of being heard, and further the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot. Admittedly, penalty has been imposed only on the basis of some observations of AO in the notice issued under section 142(1) on the basis of which it is claimed that assessee was put to the notice that in case of failure of the assessee, penalty under section 271(1)(b) would be levied. Whether such observations of AO in the notice issued under section 142(1) would be sufficient compliance with the provisions of section 274(1), which describe the procedure for imposing the penalty under Chapter XXI. It is described in section 274(1) that "no order imposing penalty under this chapter shall be made unless the assessee has been heard, or has been given reasonable opportunity of being heard". The notice issued under section 142(1) required the assessee to submit evidence to support his case but that does not mean that assessee has been put to notice for levy of penalty u/s.271(1)(b). For levy of penalty a separate notice is required to be given describing failure of the assessee for a particular date to comply with the notice. Notice under section 142(1) was for 12/2/2013 and upon non-compliance of that notice, the AO was required to issue further notice to the assessee, if he wanted ..... X X X X Extracts X X X X X X X X Extracts X X X X
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