2017 (6) TMI 452 - AT - Income Tax

Penalty u/s 271(1) (b) - undisclosed bank account - assessments u/s 153A - Held that - The assessee was subjected to such assessments u/s 153A in respect to alleged maintenance of un-disclosed HSBC, Switzerland Bank Account. The facts about the Bank Accounts and other circumstances are in the exclusive knowledge of the assessee and non co-operation leads to derailment of investigation. It is the duty of every assessee to duly respond to statutory notices failing which the law provides imposition of penalty u/s 271(1) (b) of ₹ 10,000/- each default. In this case, assessee s non compliance of statutory notice is for more than 3 times in each A. Y. CIT(A) has properly taken note of all these relevant facts, legality of notices, nature of noncompliance and its adverse impact on investigations related to alleged undisclosed HSBC bank account. We find no infirmity in the order of Ld. CIT(A) confirming the imposition of penalty of ₹ 30,000/- each in above assessment years as defaults are more than 3 times. It has been rightly held that there is no law that for each default separate notice u/s 27(1)(b) should be issued on defaulting assessee. The orders of ld. CIT(A) being justified on proper appreciation of facts and law and based. In the result, assessee s appeals are dismissed.

Summary

Issues:
Appeals challenging penalty u/s 271(1)(b) for multiple assessment years due to non-compliance with statutory notices and non-cooperation during investigations.

Analysis:
1. The appeals challenged the imposition of penalty u/s 271(1)(b) at &8377; 30,000/- for each assessment year due to non-compliance with statutory notices. The assessee argued that the penalties were illegally levied, without proper notices, and for multiple defaults attributed to a single default.

2. Despite notice of hearing, none appeared for the assessee, leading to the disposal of the appeals ex parte after hearing the Ld. DR and perusal of the record.

3. The assessments for the relevant assessment years were framed under section 153A rws 143(3) on the assessee following information about an undisclosed HSBC Bank Account in Switzerland. Statutory notices u/s 142(1) were served on the assessee for hearings, but non-compliance led to the imposition of penalty notices u/s 271(1)(b) for repetitive defaults.

4. In response to the penalty notices, the assessee challenged the legality, claiming no evidence was called for by the Assessing Officer (AO). Unsatisfactory replies led to the imposition of penalties for each assessment year.

5. The Ld. CIT(A) confirmed the penalties, considering objections raised by the appellant regarding the imposition of penalties without adequate notice, the necessity of information sought, and the absence of specific defaults or tax amounts in the penalty order.

6. The Ld. CIT(A) relied on various judgments to support the decision and upheld the penalty orders for non-cooperation and refusal to furnish information sought through statutory notices.

7. The Ld. DR contended that the assessee maintained undisclosed foreign accounts and adopted a non-cooperative attitude during investigations, justifying the imposition and confirmation of penalties by the Ld. CIT(A).

8. The Tribunal observed that the non-cooperation of the assessee hindered investigations related to the undisclosed bank accounts, leading to the imposition of penalties under section 271(1)(b) for repeated defaults, as non-compliance occurred more than three times in each assessment year.

9. The Tribunal upheld the Ld. CIT(A)'s decision, emphasizing the importance of responding to statutory notices and the adverse impact of non-compliance on investigations. The orders were deemed justified based on proper appreciation of facts and relevant legal precedents.

In conclusion, the appeals challenging the penalties under section 271(1)(b) were dismissed, affirming the imposition and confirmation of penalties for non-compliance with statutory notices and non-cooperation during investigations related to undisclosed foreign bank accounts.