Faceless assessment communication gaps justified deletion of penalty for alleged non-cooperation under the Income-tax Act.

Penalty under section 272A(1)(d) for alleged non-cooperation in response to scrutiny notices under sections 143(2) and 142(1) in a faceless assessment was found unwarranted. The Tribunal noted that communication gaps can arise in the faceless regime and treated the assessee's failure to cooperate as attributable to circumstances beyond his control. On those facts, the penalty was deleted in favour of the assessee.

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Issues: Whether penalty under section 272A(1)(d) of the Income-tax Act, 1961 was leviable for the assessee's alleged non-cooperation in response to scrutiny notices issued under sections 143(2) and 142(1) in a faceless assessment.

Analysis: The Tribunal noted that the assessment was conducted in a faceless regime and that communication gaps inherent in such a system could not be ruled out. On the facts of the case, the assessee's failure to cooperate was treated as attributable to circumstances beyond his control. In those circumstances, the Tribunal held that the levy of penalty was not justified.

Conclusion: The penalty under section 272A(1)(d) was deleted and the issue was decided in favour of the assessee.

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