Kalana N.Vyas , Ahmedabad vs Assessee

Kalana N. Vyas 7, V/S Dy. C.I.T., Circle-11 Vivekanand Society Paldi, Ahmedabad Ahmedabad 380007

(Appellant) (Respondent)

PAN: ABRPV3107B

Appellant by : None Respondent by : Shri B.L. Yadav, Sr. D.R.

(आदे श)/ORDER

Date of hearing : 22-06-2015 Date of Pronouncement : 25-06-2015

PER SHRI ANIL CHATURVEDI,A.M.

1. This appeal filed by the Assessee is against the order of CIT(A)XVI, Ahmedabad dated 22.07.2011 for A.Y. 2008-09.

2. In this case, none appeared on behalf of Assessee but however written submissions were filed by the Assessee. We therefore proceed to decide the appeal, ex parte qua the Assessee on the basis of material on record and written submissions.

2 ITA No 2117/Ahd/2011 . A.Y. 2008-09.

3. The relevant facts as culled out from the material on record are as under.

4. Assessee is an individual having income from capital gains and other sources. Assessee filed her return of income for A.Y. 2008-09 on 29.08.2008 declaring total income of Rs. 14,76,900/-. The case was selected for scrutiny and thereafter the assessment was framed under section 143(3) vide order dated 23.11.2010 and the total income as returned by the Assessee was accepted by the A.O. A.O however noticed that though the notices issued u/s. 143(2) and 142(1) to the Assessee was served upon Assessee but neither anybody attended nor furnished the required information. A.O therefore, vide order dated 4th November, 2010 imposed penalty of Rs. 20,000/- u/s. 271(1)(b) for non compliance of the notices issued u/s. 143(2) and 142(1). Aggrieved by the order of A.O., Assessee carried the matter before ld. CIT(A) who confirmed the order of A.O by holding as under:-

2.2 I have carefully considered the submission of the Ld. Counsel and the facts of the case. A show cause notice for imposition of penalty was issued on 28-10-2010 and the same was served upon the appellant on the same date. The show cause notice was to be complied with on 02-11-2010.

However, the reply to such show cause notice was filed by the assessee on 18-11-2010 whereas the penalty was levied on 04-11-2010. It is correct that no penalty can be levied without giving a reasonable opportunity of being heard but in this case even after service of show cause notice for levying the penalty, the assessee has not complied with the terms of the show cause notice on or before 02-11-2010, The appellant had thus not established before the assessing Officer that she was prevented by any reasonable cause for the default of non-compliance of notices so issued and served upon her. The Assessing Officer was thus justified in levying the penalty of Rs.

3 ITA No 2117/Ahd/2011 . A.Y. 2008-09.

20.000/- for two defaults u/s. 271(1)( b) of the Act. The same is hereby confirmed.

5. Aggrieved by the aforesaid order of ld. CIT(A), Assessee is now in appeal before us and has raised the following ground:-

1. The ld. CIT(A)-XVI, Ahmedabad has erred in confirming penalty of Rs.

20,000/- u/s. 271(1)(b) of the Income Tax Act is not correct.

6. Before us, ld. D.R. supported the order of A.O and ld. CIT(A).

7. We have heard the ld. D.R. and perused the material on record. The issue in the present case is with respect to levy of penalty u/s. 271(1)(b) of the Act. It is an undisputed fact that A.O had issued notices u/s. 143(2) & 142(1) to the Assessee and the notices remained uncomplied by Assessee. It is also a fact that in the present case, the assessment order has been framed by the A.O u/s. 143(3) and not u/s. 144 of the Act. We find that the Co-ordinate Bench in the case of Priyank Shah vs. ITO (ITA No. 237/Ahd/2013) by following the order of Tribunal in the case of Kamdhenu Motors Pvt. Ltd. v. ACIT (ITA No. 132/Ahd/2006) has held that when assessment order has been passed u/s. 143(3) and not u/s. 144, then non compliance of notice is deemed to have been waived and therefore penalties were cancelled. Respectfully following the aforesaid decision of Tribunal and in the absence of any contrary binding decision, we are of the view that the issue in the present case is covered by the decision cited hereinabove and therefore no penalty is called for. We therefore direct the deletion of penalty.

8. Thus the ground of Assessee is allowed.

4 ITA No 2117/Ahd/2011 . A.Y. 2008-09.

9. In the result, the appeal of Assessee is allowed.

Order pronounced in Open Court on 25 - 06 - 2015.

Sd/- Sd/- (KUL BHARAT) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad. TRUE COPY Rajesh

Copy of the Order forwarded to:- 1. The Appellant. 2. The Respondent. 3. The CIT (Appeals) - 4. The CIT concerned. 5. The DR., ITAT, Ahmedabad. 6. Guard File. By ORDER

Deputy/Asstt.Registrar ITAT,Ahmedabad