TaxTMI 
TaxTMI 
2017 (11) TMI 792
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....Income Tax Act, 1961 (hereinafter called "the Act"). Since the factual circumstances under which the penalties were imposed are similar in all the seven appeals, these appeals were heard together and are being disposed of through this common order for the sake of convenience. 2. These appeals involve three assessees viz. M/s Shivaganesh Buildcon Private Limited, M/s Shivnandan Buildcon (P) Ltd. and M/s Nageshwar Builder Private Limited. M/s Shivanandan Buildcon Private Limited is a company engaged in real estate, land trading and development M/s Shivagnesh Buildcon Private Limited is also a company engaged in real estate land trading and development, whereas M/s Nageshwar Builders Private Limited is a company engaged in the business of con....
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....assessee/s till the next date of hearing. Accordingly, the penalty proceedings initiated under section 271(1)(b) were kept in abeyance till the verdict of the Hon'ble High Court. The Hon'ble High Court vide order dated 20th of December 2013 decided the writ/s of the assessee/s in favour of the Department and consequently the penalty proceedings under section 271(1)(b) of the Act were taken as revived which had been kept in abeyance subsequent to the directions of the Hon'ble High Court. Thereafter, the AO did not accept the plea of the assessee/s that there was a reasonable cause on the part of the assessee/s for non-compliance of the notices issued under section 271(1)(b) of the Act and proceeded to impose the penalties. Accordingly, the A....
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....atutory notice, issued in the case of a specific assessee for a particular AY requiring attendance on the stated date, the pendency of a large number of other cases of the group is an irrelevant fact. Moreover, the burden of pendency of assessments was larger for the AO, who was required to examine each case, examine the seized materials, obtain the explanation of each assessee, carry out necessary verifications, afford opportunity to each of them in terms of the principle of natural justice, and thereafter pass the assessment order before the time barring date. Thus, the reasons cited in the written submission are rejected. 8.4. Filing of several writ petitions before the Hon'ble High Court, which in turn required substantial paperw....
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....y ignore the statutory notices, and therefore in the absence of a reasonable cause, became liable for penalty u/s 271(1)(b)." 2.4 Now the assessee/s have approached the ITAT challenging the confirmation of penalty. 3. The Ld. AR submitted that non-compliance on the part the assessee/s on the said date were due to the fact that group head, Shri Gopal Kumar Goyal was not available and the whole family members and the group heads were engaged in ongoing court proceedings to get an early release of Shri Gopal Kumar Goyal who was in judicial custody. It was submitted that this contention was raised by the assessee before the Assessing Officer in the course of the assessment proceedings but was not accepted and he proceeded to make the assessm....
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.... word "reasonable" has in law the prima facie meaning of reasonable with regard to those circumstances of which the actor, called on to act reasonably, knows or ought to know (see In re, A Solicitor (1945) KB 368 (CA).Reasonable cause can be reasonably said to be a cause which prevents a man of average intelligence and ordinary produce, acting under normal circumstances, without negligence or inaction or want of bona fides." 5.2 In the case of Azadi Bachao Andolan v. Union of India reported in 252 ITR 471 (Delhi), Delhi, the Hon'ble High Court held:- "Section 273B starts with a non obstante clause and provides that notwithstanding anything contained in several provisions enumerated therein including section 271C, no penalty shall be....
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....rred to in the concerned provision the same was without a reasonable cause The initial burden is on the assessee to show that there existed reasonable cause which gave the reason for the failure referred to in the concerned provision. Thereafter the officer dealing with the matter has to consider whether the explanation offered by the assessee or the person, as the case may be, as regards the reason for failure, was on account of reasonable cause. 'Reasonable cause" as applied to human action is that which would constrain a person of average intelligence and ordinary prudence. It can be described as probable cause. It means an honest belief founded upon reasonable grounds, of the existence of a state of circumstances, which assuming the....