2025 (6) TMI 900

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....AC has erred on facts and in law in upholding the levy of penalty of Rs. 1,50,000/- u/s 271B of the Act, 1961, which penalty is bad in law, be deleted. 2. Because there being no default as contemplated u/s 271B the penalty imposed by the AO and upheld by the CIT(A)/NFAC being bad in law be deleted. 3. Because the CIT(A)/NFAC has failed to appreciate that the assessee was prevented by sufficient and reasonable cause, totally dependent upon his tax advisors and auditors, being under bonafide belief that necessary compliance must be done by them, the penalty imposed is bad in law be deleted. 4. Because the entire facts when read with the provisions of section 273B, the assessee being prevented by reasonable cause the penalty imposed be d....

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....that impugned penalty order may be quashed. 5. On the other hand, the Ld. CIT-DR opposed the submissions and supported the orders of the lower authorities. 6. Heard the Ld. Representatives of the parties. Undisputedly, the case relates to the A.Y. 2017-18. The Income Tax Return was required to be filed on 31.10.2017. The assessee filed ITR on 29.10.2017 and accounts were audited on 28.09.2017. The assessment was completed 21.12.2019. The penalty proceedings u/s 271B of the Act was initiated on 31.12.2019 and impugned penalty order was passed on 09.06.2021, thereby imposing penalty at Rs. 1,50,000/-. It is pointed out that the penalty should have been levied by on 31.03.2020 or 30.06.2020. It is seen from the order of the Ld. CIT(A) that t....

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.... (e) notice for imposition of penalty is issued, in any other case. (2) The order imposing or enhancing or reducing or cancelling penalty or dropping the proceedings for the imposition of penalty may be revised on the basis of assessment as revised by giving effect to the order passed under section 246 or section 246A or section 253 or section 260A or section 261 or revision under section 263 or section 264, where the relevant assessment or other order is the subject matter of an appeal or a revision under the said sections. (3) No order imposing or enhancing or reducing or cancelling penalty or dropping the proceedings for the imposition of penalty under sub-section (2) shall be passed- (a) unless the assessee has been heard, or ha....