2026 (9) TMI 377

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.... Year 2019-20 for two penalty orders u/s. 271AAC(1) and 272A(1)(d). 2. Both appeals are disposed of by this common order as they pertain to same assessment year. 3. The assessee has raised following grounds of appeals:- ITA No. 610/Ahd/2026 For A.Y. 2019-20 {Penalty u/s. 271AAC(1)} "1. The Ld CIT Appeals has erred in law and on facts in upholding the decision of Ld. AO in imposing the penalty u/s 271AAC 1 of the Act of Rs. 2718063 without appreciating the Bonafide nature of transaction and modus operandi of business. The impugned penalty is unsustainable in law and therefore liable to be quashed. 2. The Appellant reserves the right to add, alter, amend, or modify any of the grounds of appeal during the course of t....

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....sequently, AO passed two penalty orders as follows: Sl. No. Remarks Order Dated Penalty Amount (Rs.) 1 271AAC(1) 02.08.2024 27,18,063/- 2 272A(1)(d) for noncompliance to specified statutory notices 30.06.2024 20,000/- 5. Aggrieved by the levy of penalties, assessee filed appeals before CIT(A). CIT(A) vide his orders dated 05-01-2026 dismissed both appeals of assessee. 5.1 Assessee preferred appeals before ITAT against orders of CIT(A) 6. We have heard the assessee's representative and perused the orders of the authorities below and materials available on record. The ld. D.R. relied upon the orders of the AO and Ld. CIT(A). 6.1 Penalty u/s. 271AAC(1) Section 271AAC(1) is a penalty provision ....

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....ntial penalty does not survive. Hence, penalty of Rs. 27,18,063/- is deleted. 7. Penalty u/s. 272A(1)(d) As assessee did not comply with specified statutory notices issued during assessment proceedings, AO passed penalty order u/s. 272A(1)(d). 7.1 Assessee is a small/rural bank business correspondent, rather than a sophisticated commercial entity. Assessee' s activity principally involved customer deposits/withdrawals/remittances on behalf of bank. Assessee did not appreciate the significance of notices uploaded on the IT portal or sent through email. Even appeals were filed belatedly by assessee. When the assessment order was passed on 12-02- 2024, assessee filed appeal before CIT(A) only on 02-07-2025 after delay of more than 16 ....