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TMI Blog2014 (2) TMI 512X X X X Extracts X X X X X X X X Extracts X X X X ..... oves that there was reasonable cause for the failure - there was reasonable cause for the failure on the part of the assessee - Relying upon Akhil Bhartiya Prathmik Shikshak Sangh Bhawan Trust vs. Assistant Director of Income Tax [2007 (8) TMI 386 - ITAT DELHI-G ] - assessment have been made under section 143(3) and not under section 144 of the IT Act - subsequent compliance in the assessment proceedings was considered as good compliance and the defaults committed earlier were ignored by the AO - thus, the penalty u/s. 271(1)(b) could not be levied – thus, the order of the CIT(A) set aside and the penalty set aside – Decided in favour of Assessee. - I.T.A. Nos. 4792-4796/Del/2013, I.T.A. Nos. 4806-4809/Del/2013, I.T.A. Nos. 4810-4814/Del ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re of the assessee to comply with the notice u/s. 142(1) issued by the AO. Penalty was levied in all the 7 years except for Ms. Swati Garg in which case penalty was levied for six years. In response to the show cause notice in this regard in the written reply, before the AO, assessee has submitted as under:- - That the group case of Shiv Vani Group is not yet fully centralized with the Central Circle-11, New Delhi. - That the group was earlier assessed at Nagpur, hence all the photocopies of seized materials are lying at Nagpur. - That the counsel for the assessment is from Nagpur. - That the photocopies of seized material are in common for all the assessee, thus the assessee requires about 45 days to co-relate the entire seized mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8. That the assessee had filed the return of income after the centralization of group cases. 9. That the assessee company is assessed to tax from many years and they had fully cooperated with the department in assessments proceedings and even during investigation proceedings with the department. 10. That the assessment for the year was passed u/s. 153A r.w.s. 143(3) and not under section 144 of the Act. From this fact it is crystal clear that the assessee made the compliance in the assessment proceedings and as such there could have been no reason to come to the conclusion that the default was deliberately or willful. This is well supported by the judgment given by the Hon'ble ITAT, Delhi Bench G in the case of Akhil Bhartiya Prathmik S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ring the Ld. Counsel of the assessee and perusing the records, we find that penalty in these cases has been levied for failure of the assessee to comply with the notice u/s. 142(1) of the I.T. Act., In this regard, it is the contention of the Ld. Counsel of the assessee that the assessee's group was earlier assessed at Nagpur. Hence, the counsel was from Nagpur. All the photocopies of the seized materials were also lying at Nagpur. In these circumstances, there was reasonable cause for the failure of the assessee to comply with the notice on the specified date. Furthermore, subsequently in response to show cause notice, assessee has sought 45 days time to comply with the notice in this regard. In our considered opinion, the above can be con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case cannot be termed as contumacious so as to warrant levy of penalty. In this regard, we refer to the decision of the Hon'ble Apex Court rendered by a larger Bench comprising of three of their Lordships in the case of Hindustan Steel vs. State of Orissa in 83 ITR 26. In this case it was held that that "An order imposing penalty for failure to carry out a statutory obligation is the result of a quasi-criminal proceedings, and penalty will not ordinarily be imposed unless the party obliged either acted deliberately in defiance of law or was guilty of conduct contumacious or dishonest, or acted in conscious disregard of its obligation. Penalty will not also be imposed merely because it is lawful to do so. Whether penalty should be imposed fo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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