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TMI Blog2025 (1) TMI 498X X X X Extracts X X X X X X X X Extracts X X X X ..... evied by the Assessing Officer (hereinafter referred to as "AO") under Section 272A(1)(d) of the Income Tax Act, 1961 (hereinafter referred to as "the Act") vide assessment order dated 12/12/2019 for the Assessment Year (AY) 2017-18. Facts of the Case: 2. The assessee is a senior citizen deriving income from pension and bank interest. The return of income for A.Y.2017-18 was filed on 19.07.2017 declaring total income of Rs. 8,29,990/-. The case was selected for limited scrutiny under CASS, and a notice u/s 143(2) of the Act was issued on 24.09.2018. Subsequent notices u/s 142(1) of the Act dated 05.04.2019 and 23.08.2019 were issued to the assessee for furnishing additional information. As the assessee allegedly failed to comply with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ircumstances of the case and in law, the Ld. CIT(A) has grossly erred in sustaining the impugned penalty of Rs. 20,000/-u/s.272A of the Act so levied by the A.O. when there is no justification in doing so. The impugned order may kindly be set aside and penalty u/s. 272A of the Act may kindly be directed to be deleted. LEAVE CRAVED The appellant craves leave to add, alter, amend and/or withdraw any of the grounds or ground of appeal either before or at the time of appeal hearing. RELIEF CLAIMED The appellant respectfully urges that by allowing ground no.1 so being raised by the appellant, the impugned order may kindly be quashed and set aside, and by allowing ground no.2, the penalty of Rs. 20,000/- may kindly be deleted. 5. During ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e steps to comply and filed an appeal against the assessment order and penalty. However, despite this detailed explanation, as stated by the AR, the CIT(A) summarily dismissed the affidavits as afterthoughts and failed to conduct an inquiry or provide an opportunity for rebuttal, violating the principle of natural justice. The AR relied on judicial precedents, including Glass Lines Equipments Co. Ltd. v. CIT (253 ITR 454) (Gujarat HC), wherein it was held that an affidavit must be read as a whole, and any rejection must be based on valid reasons. It was further argued that the show-cause notice was vague and did not specify the exact notices that were allegedly non-complied with. 5.1. The AR further argued that the penalty notice issued u/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... non-compliance, asserting that the communication failure was due to his representative's inaction. However, the CIT(A) summarily dismissed the affidavits as afterthoughts without providing an opportunity for cross-examination or conducting an independent inquiry. This action amounts to a violation of the principles of natural justice. The Hon'ble Jurisdictional High Court in the case of Glass Lines Equipments Co. Ltd. v. CIT (253 ITR 454) has held that affidavits must be read in their entirety, and selective acceptance or rejection without valid reasoning is impermissible. 7.1. The facts clearly indicate that the non-compliance was not due to any willful default or mala fide intent on the part of the assessee. The lapse occurred due to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the authorized representative explain the genuine reasons behind the non-compliance. There was no evidence to suggest any mala fide intent or willful defiance by the assessee. Therefore, the penalty imposed does not stand in light of the reasonable cause demonstrated by the assessee. The assessee complied with the initial notice u/s 143(2) of the Act on 01.10.2018 and only failed to comply with subsequent notices due to a communication gap. This shows that the assessee had the intention to comply with the proceedings and that the subsequent default was inadvertent and not deliberate. Hence, the penalty imposed cannot be justified under such circumstances. 7.4. In light of the above findings and judicial precedents relied on, we hold that t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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