2023 (6) TMI 395 - AT - Income Tax

Levy of penalty u/s 272A(2)(c) - non-compliance of notice issued u/s 133(6) - HELD THAT - We find that CIT(A) had noted that the show cause notice could only be sent through e-mail. There was non-compliance to the notice issued u/s 133(6) in spite of the fact that the notice having been served on the assessee. We understand that if an e-mail address is updated on the Income Tax Portal on 29.03.2019, then the subsequent communications by the Income Tax Authorities would automatically uploaded on the system and send to the updated new e-mail address of the appellant assessee. As further, assessee had done last login on 12th April, 2023 at 11.58 AM on the updated e-mail address which shows that he has not done any communication of the Income Tax proceedings taken by the Income Tax Department against him by way of notice issued u/s 133(6) - Thus, the contention of the assessee, that assessee has not been served the notice u/s 133(6) is factually incorrect. Assessee s request that the quantum appeal of penalty u/s 272A(2)(c) may be limited to the period excluding the Covid period exempted by the Apex Court is justified. Accordingly, AO is directed to levy of penalty u/s 272A(2)(c) for the period of 30.07.2019 to 14.04.2020, in the light of the Hon ble Apex Court judgment delivered on miscellaneous application 2022 (1) TMI 385 - SC ORDER whereby their Lordship has extended period of limitation for any such appeal application or proceedings from 15.03.2020 till 14.03.2021. Penalty levied u/s 272A(2)(c) is restricted for the period from 30.07.2019 to 14.03.2020. According, the AO is directed to recompute the penalty amount for the period restricted as above. Appeal of the assessee stand allowed.

Summary

Issues involved: Challenge against levy of penalty u/s 272A(2)(c) for non-compliance of notice issued u/s 133(6) of the Income Tax Act for AY 2013-14.

Summary:

Issue 1: Challenge against penalty u/s 272A(2)(c) for non-compliance of notice u/s 133(6):
The appeal was filed against the order of the Ld. Commissioner of Income Tax (Appeals) confirming a penalty of Rs.27,400/- out of Rs.59,100/- for non-compliance of the notice issued u/s 133(6) of the Act. The appellant argued that the penalty should be deleted or modified to exclude the Covid period, which was exempted by the Hon'ble Apex Court. It was contended that while the notice was sent via email, no physical notice was served. The argument was that the notice sent to the updated email address was not acknowledged, but the tribunal found that the appellant had not informed the AO about the change of email address. The tribunal held that the penalty should be limited to the period excluding the Covid period as per the Apex Court judgment, directing the AO to recompute the penalty amount accordingly.

Decision:
The tribunal allowed the appeal, restricting the penalty u/s 272A(2)(c) for the period from 30.07.2019 to 14.03.2020, in line with the Hon'ble Apex Court judgment regarding the Covid period exemption. The AO was directed to recompute the penalty amount for the specified period.