ITAT allows appeals challenging penalties for e-statement non-furnishing, stresses importance of opportunity to be heard.

The ITAT allowed the appeals filed by the assessee challenging the penalty imposed for failing to furnish e-statements to TDS Officers. The delay in filing appeals was condoned due to genuine difficulties faced, directing the CIT(A) to adjudicate on merits. The ITAT emphasized the importance of providing an opportunity to be heard and set aside all issues for fresh adjudication. The judgment focused on the first default by the assessee, acknowledging challenges in infrastructure and manpower, ultimately allowing the appeals for statistical purposes.

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Issues involved:
Levy of penalty under section 272A(2)(k) for failure to furnish e-statements to TDS Officer; Condonation of delay in filing appeals before CIT(A); Adjudication on merits after delay condonation.

Analysis:

Issue 1: Levy of penalty under section 272A(2)(k)
The appeals filed by the assessee challenged the penalty imposed by the Assessing Officer for the delay in furnishing e-statements to the TDS Officers. The reasons cited for the delay included lack of internet knowledge and infrastructure, changes in procedures due to amendments, and shortage of manpower in government offices. The CIT(A) dismissed the appeals due to the delay in filing them. However, the ITAT observed that the TDS was done correctly and the tax was credited on time to the Government Account. Considering this as the first default by the assessee and the genuine difficulties faced, the ITAT directed the CIT(A) to condone the delay and hear the case on merits.

Issue 2: Condonation of delay in filing appeals before CIT(A)
The assessee sought condonation of delay in filing the appeals before the CIT(A) due to various challenges faced in complying with the law related to e-quarterly statements. The counsel highlighted problems such as staff shortages, lack of infrastructure, and procedural knowledge. The ITAT acknowledged the genuine difficulties faced by the assessee and directed the CIT(A) to reconsider the case after condoning the delay, emphasizing the importance of providing an opportunity to be heard.

Issue 3: Adjudication on merits after delay condonation
After considering the arguments from both parties and reviewing the circumstances specific to the assessee, the ITAT concluded that the delay in filing the appeals should be condoned. The ITAT emphasized that this was the first default by the assessee and noted the challenges related to infrastructure and manpower. Therefore, the ITAT set aside all issues raised in the appeals to be adjudicated afresh by the CIT(A) after granting a hearing to the assessee. As a result, all appeals filed by the assessee were allowed for statistical purposes.

In conclusion, the ITAT's judgment focused on the genuine difficulties faced by the assessee in complying with the requirements of furnishing e-statements, leading to the condonation of the delay in filing the appeals and a direction to reconsider the case on merits.

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