TMI Blog2023 (9) TMI 320X X X X Extracts X X X X X X X X Extracts X X X X ..... s called for by the A.O. The assessee, on the other hand, contends that he was non compliant to the said notices as it was during the Pandemic period and due to which the assessee himself was hospitalized. It is also observed that the assessee vide letter dated 03.03.2021 has furnished copies of purchase deed dated 29.09.2017 and had also made written submission subsequently. A.O. has passed the assessment order u/s. 143(3) r.w.s. 143(3A) and 143(3B) and not u/s. 144 i.e., the best judgment assessment. It is evident that the assessee has made some compliance before the A.O. and it is not a case of the complete non compliance. As it is observed that when there is a reasonable cause for the said failure, the penalty imposed u/s. 272A su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al and had filed his return of income dated 29.03.2019, declaring total income at Rs. 6,92,940/-. The assessee s case was selected for scrutiny and the assessment order u/s. 143(3) r.w.s. 143(3A) and 143(3B) of the Act dated 08.04.2021 was passed by the A.O. and the A.O. made an addition of Rs. 49,87,000/- u/s. 68 of the Act on the ground that the assessee has failed to substantiate the source for purchase of property treating the same to be unexplained credit u/s. 68 of the Act. The A.O. initiated penalty proceeding u/s. 272A(1)(d) of the Act for non compliance to notice u/s. 142(1) of the Act. The A.O. vide order dated 13.08.2021 levied penalty amounting to Rs. 50,000/- u/s. 272A(1)(d) of the Act. 5. The assessee was in appeal before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y reference: Penalty for failure to answer questions, sign statements, furnish information, returns or statements, allow inspections, etc. 272A. (1) If any person, (a) being legally bound to state the truth of any matter touching the subject of his assessment, refuses to answer any question put to him by an income-tax authority in the exercise of its powers under this Act; or (b) refuses to sign any statement made by him in the course of any proceedings under this Act, which an income-tax authority may legally require him to sign; or (c) to whom a summons is issued under sub-section (1) of section 131 either to attend to give evidence or produce books of account or other documents at a certain place and time o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on compliance. As it is observed that when there is a reasonable cause for the said failure, the penalty imposed u/s. 272A sub section (1) of the Act is protected as per the provision of section 272B where the penalty shall not be imposed when the assessee has substantiated reasonable cause for such failure. In the present case in hand, the notice issued u/s. 142(1) of the Act was during the Covid Pandemic period which is a justifiable cause for the non compliance before the A.O. We, therefore, deem it fit to delete the impugned penalty levied by the A.O. and, therefore, the grounds raised by the assessee are allowed. 11. In the result, the appeal filed by the assessee is allowed. Order pronounced in the open court on 28.08.2023 - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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