Non-compliance of Notice should be treated as single default in case of Multiple Notices on same issue: ITAT

The Income Tax Appellate Tribunal (ITAT), Indore, recently condoned a delay and reduced the penalty as the notices were issued one after another, seeking the same information. The Tribunal held that such notices only constitute a single default.

The assessee, Ganpat Singh, was aggrieved by a penalty of Rs 50,000 imposed by the Income Tax Officer for the non-compliance with five successive notices under section 142(1). All these notices asked for information regarding the sale of land by the appellant.

The assessee filed an appeal before the ITAT, but the same was delayed. He explained that the delay was caused because of his ailing condition. The Tribunal, after considering this reason and citing the Supreme Court Ruling in Collector, Land Acquisition Vs Mst. Katiji and others 1987 AIR 1353, 1987 2 SCC 387, condoned the delay.

Regarding the penalty of Rs 50,000, the assessee argued that these notices were related to the same issue, and non-compliance should be treated as a single default, and the penalty should be only Rs 10,000. The Tribunal also agreed with the contention of the assessee and held that if the notices are issued by the AO one after another, asking for the same information, it will not multiply the default and would make a single default.

Based on the same, the ITAT only confirmed the first non-compliance penalty of Rs 10,000 and the remaining penalty was deleted.