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Judgment
PER NAVEEN CHANDRA, ACCOUNTANT MEMBER :
The captioned appeal preferred by the assessee is against the order of the learned Commissioner of Income Tax-NFAC Delhi dated 04.12.2025 arising out of penalty order passed under section 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) by the NFAC, for the Asstt. Year 2012-13.
None appeared on behalf of the assessee. We heard the ld. DR at length who assisted us with the facts of the case and relied on the orders of the Assessing Officer. Case records carefully perused and considered.
Brief facts of the case are that the assessee is an individual who filed the original return of income for A.Y. 2012–13 on 06.08.2012, declaring a total income of Rs.5,12,548. Based on AIR information, the Assessing Officer came to know that the assessee had purchased an immovable property worth Rs.31,00,000 during F.Y. 2011–12, the AO reopened the assessment by issuing notice under section 148 on 29.03.2019. Subsequently, statutory notices under section 142(1) dated 21.08.2019 and 30.10.2019, along with a detailed questionnaire, were issued requiring the assessee to furnish documentary evidence.
The assessee had not responded to these notices. A final show-cause notice under section 144 of the Act on 15.11.2019, fixing compliance on 22.11.2019, was also ignored. Owing to repeated non-compliance, the AO completed the assessment ex parte under section 144/147 on 29.11.2019, determining the total income of Rs.36,12,948 after making an addition of Rs.31,00,000 towards unexplained investment in the purchased property. Penalty proceedings under section 271(1)(c) were initiated vide notice dated 29.11.2019 for concealment of income.
The quantum appeal was decided by the CIT(A) against the assessee on the ground that the assessee failed to explain the source of investment during assessment as well as appellate proceedings. During the penalty proceedings, as no supporting evidence, explanation, or documentary proof was submitted regarding the source of funds or filing of the ITAT appeal, the AO levied penalty for concealment under section 271(1)(c).
Aggrieved, assessee was in appeal before the CIT(A), which the CIT(A) dismissed ex-parte on account of non-prosecution of the appeal by the assessee. Aggrieved, assessee is in appeal before us with the following grounds:
“1.That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts that order passed by the A.O. is in bad in law and against the cannon of taxation.
2.That having regards to facts and circumstances of the case the CIT(A) has not consider the reply and documents filed during appeal proceedings.
3.That having regards to facts and circumstances of the case the appeal of quantum is decided that and set aside for fresh assessment by the Hon’ble ITAT.
4.The Appellant reserves its right add to amend to alter to submit additional evidence under rule 46A or to take additional grounds and in appeal memo at the time of hearing.
5.The Appellant craves the leave to add, modify, amend or delete any of the Grounds of appeal at the time of hearing and all the grounds are without prejudice to each other.”
We have heard the learned DR and perused the material available on record. We find that the CIT(A), in absence of any response from the assessee, passed an ex-parte order without determining the issues as per the provisions of section 250(6) of the Act. We further find that the ITAT, in the quantum appeal, has set aside the issues for fresh adjudication to the AO. We are of the considered view therefore the penalty levied by the AO should also be set aside to the AO for fresh adjudication. The AO is directed to accord three effective opportunities to the assessee and assessee is likewise directed to avail the opportunities and submit documents/evidence as required by the AO. The appeal of the assessee is decided in aforesaid terms.
In the result, appeal of the assessee is allowed for statistical purposes.