INCOME TAX ACT, 1961

Section 271(1)(c)

Penalty under section 271(1)(c) - Validity - Appeal was dismissed on account of Non-appearance on tha part of assessee -

On the basis of the information from Investigation Wing that assessee company had made transactions with a group concern was detected during the search proceedings under section 132 and it was noted that the group was providing accommodation entries in the shape of share capital/share premium. Case of assessee was reopened under section 147 and notice under section 148 was issued. AO completed the assessment under section 143(3)/148 and made an addition to total income. Subsequently, AO initiated penalty proceedings under section 271(1)(c). Since none appeared on behalf of assessee, CIT(A), in the ex parte order passed by her, dismissed the appeal for non-prosecution. Held: Due to non-appearance, CIT(A), relying on the decision of Tribunal in the case of CIT v. Multiplan India Ltd. [(1991) 38 ITD 320 (Del) : 1991 TaxPub(DT) 1420 (Del-Trib)] and various other decisions, dismissed the appeal for non-prosecution. However, she had not decided the appeal on merit. Therefore, in the interest of justice, matter was remanded back to CIT(A) with a direction to grant one final opportunity to the assessee to substantiate its case and decide the issue as per facts and law.

Followed:CIT v. BN Bhattachargee & Anr. (1979) 118 ITR 461 (SC) : 1979 TaxPub(DT) 1026 (SC) CIT v. Multiplan India (P) Ltd. (1991) 38 ITD 320 (Del) : 1991 TaxPub(DT) 1420 (Del-Trib)

REFERRED :

FAVOUR : In assessee's favour by way of remand

A.Y. :

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