Covid-related limitation relief and lack of proper notice led to restoration of ex parte penalty appeals for fresh hearing

Delay of 266 days in filing penalty appeals was condoned because the period overlapped with the Covid-19 pandemic and the Supreme Court's limitation-exclusion directions. The ex parte penalty orders under section 271(1)(c) were then found unsustainable because the record did not show proper service of the final hearing notices. The matters were restored to the appellate authority for fresh adjudication after granting effective opportunity of hearing, with no decision on the merits of the additions or penalty.

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Issues: (i) Whether the delay of 266 days in filing the appeals deserved condonation; (ii) Whether the ex parte penalty orders under section 271(1)(c) required restoration for fresh adjudication.

Issue (i): Whether the delay of 266 days in filing the appeals deserved condonation.

Analysis: The delay fell within the period affected by the Covid-19 pandemic and the limitation exclusion directions issued by the Supreme Court in the cognizance for extension of limitation proceedings.

Conclusion: The delay was condoned.

Issue (ii): Whether the ex parte penalty orders under section 271(1)(c) required restoration for fresh adjudication.

Analysis: The record did not show proper service of the last hearing notices, and the ex parte disposal was found unsustainable in the circumstances. The matters were therefore fit to be sent back for a fresh decision after granting effective opportunity of hearing.

Conclusion: The appeals were restored to the appellate authority for fresh adjudication in accordance with law.

Final Conclusion: The assessee obtained only procedural relief, with the penalty appeals reopened for reconsideration and no decision rendered on the merits of the additions or penalty.

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