2013 (4) TMI 179

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....sioner of Income Tax, Central Circle-38. 2. On the facts and in the circumstances of the case, the CIT(A) erred in confirming the penalty as there was no default committed by the appellant under the provision of sec. 271 (1)(b). 3. Without prejudice to the above grounds the Ld. CIT(A) erred in confirming the penalty when the default was for good and sufficient reasons." 2. At the outset it was submitted by Ld. AR that this is a covered issue as penalty in respect of earlier years i.e. with respect of A.Y 2005-06 and A.Ys 2002-03, 2004-05, 2006-07, 2008-09 and 2003-04 have already been deleted by the Tribunal. Reference was made to the Tribunal order dated 9/5/2012 vide which penalties in respect of A.Ys 2002-03, 2004-05, 2006-07, 2....

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....6/M/2011 Shri Parag M. Sanghvi 2002-03 1,50,000 10 8667/M/2011 "..do.." 2003-04 1,90,000 11 8668/M/2011 "..do.." 2008-09 1,14,164 3. It is pertinent to note here that in some of the assessment years even if these are assessment arising out of the search and seizure action, the returns of income filed by the assessees are accepted. 4. So far as the issue of the levy of the penalty u/s.271(1)(b) is concerned, the A.O. has levied the penalty at Rs.10,000/- per assessment year before us for failure to comply to attend the hearing on 20.10.2009. In all these cases the reasons given by the A.O. for the levy of the penalty is verbatim which is as under: 5. The A.O. has observed that during the course....

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....ed to be filed on 20.10.2009, but, it appears that there was no compliance and hence, the A.O. invoked sec.271(1)(b) and levied the penalty. 7. relevant part Section 271(1)(b) reads as under: "271 (1) If the Assessing Officer or the Commissioner (Appeals)] or the Commissioner] in the course of any proceedings under this Act, is satisfied that any person-- (a) ...... "(b) has failed to comply with a notice [under sub-section (2) of section 115WD or under sub-section (2) of section 115WE or under sub-section (1) of section 142 or sub-section (2) of section 143 or fails to comply with a direction issued under sub-section (2A) of section 142, or............." 8. So far as the assessment orders in all respect of these assessees ar....

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....tate of Orissa 83 ITR 26 the Hon'ble Supreme Court has held as under: "An order imposing penalty for failure to carry out a statutory obligation is the result of a quasi-criminal proceeding, and penalty will not ordinarily be imposed unless the party obliged, either acted deliberately in defiance of law or was guilty of conduct contumacious or dishonest, or acted in conscious disregard of its obligation. Penalty will not also be imposed merely because it is lawful to do so. Whether penalty should be imposed for failure to perform a statutory obligation is a matter of discretion of the authority to be exercised judicially and on a consideration of all the relevant circumstances. Even if a minimum penalty is prescribed, the authority compe....