TMI Blog2017 (9) TMI 115X X X X Extracts X X X X X X X X Extracts X X X X ..... dings 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. - I.T.A. No.4429 to 4434/DEL/2015 - - - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... non-compliance of certain statutory notices by the assessee and accordingly, show cause notice was issued on 24/6/2013. In response to the show cause notice, the assessee filed very detailed explanation, challenging the validity of initiation of penalty proceedings and explaining the reasonable cause for non-compliance on the appointed days. The sum and substance of assessee s explanation is that; * firstly, penalty notice u/s 271(1)(b) itself is vague because it does not specify about any notice or date of compliance for which there was failure on part of the assessee, that is, it does not mention about any notice or any date of noncompliance for which such penalty proceedings has been initiated; * secondly, the assessee has ulti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en submission, namely, search operations on the MDLR group in January 2008, detention of Shri Gopal Goyal, poor turn-out of employees at work place, large number of pendency of 4 assessments u/s 153A, and preparation of voluminous details, constitute reasonable cause that prevented the appellant from complying with the aforementioned notices or filing letters to seek adjournment. Search had taken place in January 2008, following which 153A proceedings were inevitable. The revision petitions u/s 264 were moved by the appellant and the subsequent assessments were required to be completed by the AO before the limitation date, in respect of which also, as per the AO, the requisite details were not being filed. In considering the matter of p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ause for such failure is proven. In the case at hand, the appellant has made assertions and claims that are not valid for non-compliance of statutory notices. No compelling and reasonable cause for failure to comply with the statutory notices has been advanced. 8.6. While examining the matter of penalty u/s 271(l)(b) read with section 274, the only aspect that has to be examined is 5 whether there was any reasonable cause that prevented the appellant from complying with the statutory notices issued by the AO. Here, the appellant did not comply with the statutory notices on 2 different occasions spread over a period of 3 months. The appellant could have escaped from the rigors of penalty, had the statutory notice been acknowledged an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere in this case, 6 first of all, on perusal of the penalty notice as appearing at page no. 6 of the paper book, 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. Show cause notices issued for initiating penalty proceedings should be specific and without any ambiguity, because the assessee while giving the explanation should be aware of the charge for which penalty is being initiated and can give his specific rebuttal. Such vague notice is fatal to the initiation of the proceedings itself. Further from the perusal of the assessment order, it is gathered that the assessee did not attend the proceedings on 20.11.2012 and 30.11.2012. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ain planks for reasonable cause pleaded by the assessee has been that, firstly, the key person/group head, Shri Gopal Kumar Goyal who was entrusted with income tax matters and was looking after the entire working of the group was in judicial custody in some criminal proceedings and the entire group and family members were engaged in ongoing court proceedings for his early release and various employees were leaving the group further accentuating the problems; secondly, more than 300 group assessments were initiated in the wake of search proceedings which were simultaneously going on, therefore, it was difficult to comply to the various notices on short dates; lastly, it has been strongly pleaded before us, that the compliances had been ..... X X X X Extracts X X X X X X X X Extracts X X X X
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