2019 (4) TMI 1295 - AT - Income Tax

ITAT allows appeals for violations of natural justice in penalty orders under Income-tax Act

The ITAT allowed the appeals by the assessee for statistical purposes as there was a violation of natural justice in the penalty orders under sections ... Penalty u/s. 271(1)(c),  271B and 271F - violation of Natural Justice - HELD THAT:- Penalty u/s 271B and 271F - As perused the notice and take note that the notice fixing the date of hearing before CIT(A) is noted as on 06.11.2017 whereas the impugned order has been passed five days before the date of hearing, therefore, there is a clear violation of natural justice and, therefore, we set aside the orders of the CIT(A) and remand the matter back to his file to decide afresh the appeals after providing adequate opportunity to the assessee according to law. Both these appeals of assessee are allowed for statistical purposes. Penalty u/s 271(1)(c) - We note that the impugned order has been passed on 13.11.2017 overlooking the assessee’s adjournment application for just cause, which action of CIT(A), according to us, is not reasonable or fair and is in violation of Natural Justice, therefore, we set aside the order of the CIT(A) and remand the matter to his file for fresh adjudication. - Appeals of assessee are allowed for statistical purposes. Issues:Appeals against penalty orders under sections 271B, 271(1)(c), and 271F of the Income-tax Act, 1961 due to violation of natural justice by the Ld. CIT(A).Analysis:1. Penalty Orders under Sections 271B and 271F:The appeals by the assessee were against the penalty orders confirmed by the Ld. CIT(A) for AY 2009-10 under sections 271B and 271F of the Income-tax Act. The Ld. AR highlighted that the orders passed by the Ld. CIT(A) were ex parte in nature. Upon review, it was noted that the notice fixing the date of hearing was after the orders were passed, indicating a violation of natural justice. Consequently, the ITAT set aside the orders of the Ld. CIT(A) and remanded the matter for fresh adjudication, allowing the appeals for statistical purposes.2. Penalty under Section 271(1)(c):Regarding the penalty imposed under section 271(1)(c) of the Act, it was observed that the Ld. CIT(A) dismissed the appeal without hearing the assessee despite an adjournment application due to the fixing of the hearing date before the requested date. The ITAT found this action to be unreasonable, unfair, and in violation of natural justice. Therefore, the order of the Ld. CIT(A) was set aside, and the matter was remanded for fresh adjudication, allowing the appeal for statistical purposes. All the appeals by the assessee were restored back to the file of Ld. CIT(A.In conclusion, all the appeals by the assessee were allowed for statistical purposes due to the violation of natural justice in the penalty orders under sections 271B, 271(1)(c), and 271F of the Income-tax Act, 1961. The ITAT remanded the matters back to the Ld. CIT(A) for fresh adjudication, ensuring adequate opportunity for the assessee in line with the principles of natural justice.