Penalty for isolated non-appearance deleted where subsequent compliance showed substantial adherence to hearing notices.

Penalty for a single non-appearance at a hearing notice was found unwarranted where the assessee later attended proceedings and furnished the required details. The assessment was completed under Section 143(3), showing substantial compliance with the notices and that the earlier default had been effectively cured in substance. On that basis, the levy of penalty for non-compliance with the hearing notice under Section 271(1)(b) was deleted, leaving no sustainable penalty for the isolated missed date.

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Issues: Whether penalty imposed for non-compliance with the hearing notice under Section 271(1)(b) of the Income-tax Act, 1961 was sustainable in the facts of the case.

Analysis: The assessee missed one scheduled hearing date but thereafter appeared and furnished the required details on subsequent dates. The assessment was ultimately completed under Section 143(3) of the Income-tax Act, 1961, indicating that the assessee had substantially complied with the notices and that the default for the earlier absence stood condoned in substance. In such circumstances, the levy of penalty for the single instance of non-appearance was held to be unwarranted.

Conclusion: The penalty under Section 271(1)(b) of the Income-tax Act, 1961 was deleted and the issue was decided in favour of the assessee.

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