HARI MOHAN AND SONS,MUZAFFARNAGAR VS. INCOME TAX OFFICER, WARD – 3(2)(1), MUZAFFARNAGAR
In a recent decision, the Income Tax Appellate Tribunal (ITAT) Delhi Bench has ruled in favour of the assessee by deleting the penalty levied under Section 271F of the Income-tax Act, 1961 for A.Y. 2013–14. The Tribunal held that since the return of income was filed within the prescribed time under Section 139 of the Act, the penalty was unjustified.
Background
The Assessing Officer (AO) imposed a penalty of ₹5,000 under Section 271F on the grounds that the assessee had failed to file their return of income within the due date prescribed under Section 139(1). This was upheld by the CIT(A), who characterized the assessee as a “non-filer.”
Assessee’s Stand
Before the ITAT, the assessee—represented by Shri Ankit Gupta, Advocate—contended that the return of income was, in fact, filed on 21.02.2014, well within the time allowed under Section 139(4) for A.Y. 2013–14. It was further pointed out that this fact was duly recorded by the AO himself in the reassessment order passed u/s 143(3)/147 dated 31.03.2022.
The assessee argued that once the return had been filed within the extended time permitted by law, the levy of penalty under Section 271F was not sustainable.
Tribunal’s Observations
The Tribunal carefully considered the submissions and perused the records. It noted:
- The return was indeed filed on 21.02.2014.
- The filing was within the time permitted under Section 139(4).
- The AO himself acknowledged the filed return in the reassessment order.
The ITAT held that the assessee could not be treated as a non-filer, and once a valid return had been submitted within the permissible time, the penalty under Section 271F could not be imposed.
Ruling
The Tribunal allowed the appeal and deleted the penalty of ₹5,000 imposed under Section 271F, terming it as “arbitrary” and “unjustified.”