ITAT allows appeal on filing delay & penalties for AY 2009-10, remits case for fresh adjudication.

The ITAT allowed the appeal concerning the delay in filing the appeal before CIT(A) for AY 2009-10, remitting the case for fresh adjudication due to the assessee's misunderstanding. Additionally, the ITAT allowed the appeal against penalties imposed under section 271(1)(c) for various disallowances in the quantum assessment, citing the invalidity of the penalty notice issued by the AO. The revenue's appeal on penalties was dismissed as infructuous following the ITAT's decision to set aside the penalties.

---

---

Issues Involved:
1. Delay in filing appeal before CIT(A) for AY 2009-10.
2. Penalties levied under section 271(1)(c) for various disallowances in the quantum assessment.

Issue 1: Delay in filing appeal before CIT(A) for AY 2009-10:
The assessee appealed against the order of ld. CIT(A) relating to the assessment for AY 2009-10 with a delay of 653 days. The CIT(A) dismissed the appeal citing lack of cogent reasons for the delay, leading to the assessee's appeal to the ITAT. The ITAT observed that the delay was due to the assessee's misunderstanding regarding the relevance of the appeal for AY 2008-09 to AY 2009-10. The ITAT remitted the case back to the CIT(A) for a fresh adjudication, emphasizing that technical reasons should not deprive the assessee of the right to appeal.

Issue 2: Penalties levied under section 271(1)(c) for various disallowances in the quantum assessment:
In the quantum assessment, various additions were made by the AO, including disallowances under different sections totaling to significant amounts. The AO initiated penalty proceedings under section 271(1)(c) for alleged failure to disclose true particulars. The CIT(A) upheld the penalties related to specific disallowances. However, the ITAT admitted an additional ground raised by the assessee regarding the validity of the penalty notice issued by the AO. Citing a Supreme Court decision, the ITAT found the notice invalid as it did not specify the grounds for penalty initiation. Consequently, the ITAT set aside the penalties imposed by the AO, allowing the assessee's appeal.

In summary, the ITAT allowed the appeal related to the delay in filing the appeal before CIT(A) for AY 2009-10, remitting the case back for fresh adjudication. Additionally, the ITAT allowed the appeal against the penalties imposed under section 271(1)(c) for various disallowances in the quantum assessment, based on the invalidity of the penalty notice issued by the AO. The revenue's appeal on penalties was dismissed as infructuous due to the quashing of the penalties.

---