IN INCOME TAX APPELLATE TRIBUNAL "F" Bench, Mumbai Before Shri Jason P. Boaz, Accountant Member and Shri Sandeep Gosain , Judicial Member ITA Nos. 7754 & 7755/Mum/2014 (Assessment Years: 2009-10 & 2010-11) M/s. Varad Fashions P. Ltd. Addl. CIT (TDS), Range-3 Aryston Centre, Juhu Road 10th Floor, Smt. K.G. Mittal Vs. Near J-49 Club, Juhu Ayurvedic Hospital Bldg. Mumbai 400049 Charni Road, Mumbai - 002 PAN AABCV2850P Appellant Respondent Appellant by: Shri Nitin Joshi & Shri C.S. Ananthan Respondent by: Ms. Radha Katyal Narang Date of Hearing: 04.10.2016 Date of Pronouncement: 07.10.2016 ORDER Per Jason P. Boaz, A.M. These appeals by assessee are directed against orders of CIT(A)-14, Mumbai dated 08.10.2014 upholding levy of penalty of `1,20,300/- and `83,530/- under section 272A(2)(k) of Income Tax Act, 1961 (in short, 'the Act') by Assessing Officer (AO) for assessment years 2009-10 and 2010-11 respectively. These appeals having common issues, were heard together and being disposed off by way of this combined order. 2. In these appeals, assessee has raised similar grounds challenging levy of aforesaid penalties under section 272A(2)(k) of Act for both assessment years 2009-10 and 2010-11 and therefore grounds raised for A.Y. 2009-10 only are extracted hereunder: - 1. On facts and circumstances of case and in law, Commissioner of Income tax (Appeals) erred in not giving Appellant opportunity of being heard before confirming penalty of Rs.1,20,300 under section 272A(2)(k) of Income tax Act, 1961 ( Act ). 2 ITA Nos. 7754&7755/Mum/2014 M/s. Varad Fashions P. Ltd. 2. On facts and circumstances of case and in law, Commissioner of Income tax (Appeals) erred in confirming penalty of Rs.1,20,300 under Section 272A(2)(k) of Act. 3. Ground No. 1 (for both assessment years 2009-10 & 2010-11) 3.1 In this ground, assessee contends that learned CIT(A) erred in not affording assessee opportunity of being heard before confirming levy of penalty under section 272A(2)(k) of Act by way of impugned orders. According to learned counsel for assessee, AO after issuing show cause notices dated 04.10.2011 called upon assessee to show cause as to why penalty under section 272A(2)(k) of Act should not be levied in its case for assessment years 2009-10 and 2010-11 for non filing of quarterly TDS statement in Form No. 24Q & 26Q for three years within stipulated period; proceeded to levy penalties thereunder vide separate orders dated 31.10.2011, before assessee could furnish its reply in matter, stating that since no reply was filed, assessee has not established reasonable cause for default. 3.2 Aggrieved by orders of AO dated 31.10.2011 levying penalty of `1,20,300/- and `83,530/- for assessment years 2009-10 and 2010-11, assessee preferred appeals before CIT(A)-14, Mumbai. learned counsel for assessee contends that learned CIT(A) virtually dismissed assessee s appeals for both concerned years exparte, without affording assessee any opportunity whatsoever of being heard in matter. According to learned A.R., perusal of orders of authorities below would evidence that, neither AO nor learned CIT(A) has afforded assessee reasonable opportunity of being heard. AO merely mentioned that assessee had not filed any reply/submission to establish reasonable cause for failure to fulfil its obligations under Act. learned CIT(A) also, after issuing one notice for hearing on 30.09.2014, dismissed assessee s appeals on 08.10.2014 on ground that none appeared nor any written submission was filed; when actually, assessee had filed letter dated 26.09.2014 in office of CIT(A)-14, Mumbai, receipt of which was duly acknowledged/stamped, seeking adjournment of hearing till last week 3 ITA Nos. 7754&7755/Mum/2014 M/s. Varad Fashions P. Ltd. of October, 2014 since A.R. was scheduled to travel. learned A.R. Contends that in light of above facts it has been clearly demonstrated that learned CIT(A) by summarily dismissing appeals, has violated principles of natural justice by not affording assessee adequate opportunity of being heard in matter before adjudicating appeal. It is pleaded that in above circumstances, impugned orders of learned CIT(A) for assessment years 2009-10 and 2010-11 be set aside and restored to file of learned CIT(A) for adjudication of issue of levy of penalty afresh on merits after affording assessee adequate opportunity of being heard and to file submissions/details required. 3.3.1` We have heard rival contentions and perused and carefully considered material on record. grievances of assessee, according to learned counsel for assessee, was that learned CIT(A) had dismissed assessee s appeals for assessment years 2009-10 and 2010-11 summarily, without affording assessee any opportunity whatsoever of being heard in matter of levy of penalty under section 271A(2)(k) of Act by AO. In this regard, we have perused impugned orders of learned CIT(A), both dated 08.10.2014, for concerned assessment years as well as assessee s letters dated 26.09.2014 acknowledged to have been filed in office of learned CIT(A) on 30.09.2014 (copies placed on record) seeking adjournment of hearing of appeals to end of October, 2014 since learned counsel for assessee was scheduled for travelling. We observe that in impugned orders learned CIT(A), after observing that none appeared nor written submissions were filed, proceeded to dismiss assessee s appeals on 08.10.2014. This, inspite of fact that assessee had filed two separate letters dated 26.09.2014 seeking adjournment of hearings, which were acknowledged to have been received and were available in her office on 30.09.2014, at least week before she dismissed both assessee s appeals summarily on 08.10.2014. In this factual matrix of case, as discussed above, we are of considered view that learned CIT(A) has grossly violated principles of natural justice by not affording 4 ITA Nos. 7754&7755/Mum/2014 M/s. Varad Fashions P. Ltd. assessee adequate opportunity of being heard in matter of levy of penalty under section 272A(2)(k) of Act in case on hand for both assessment years 2009-10 and 2010-11. In this view of matter, we, in interest of equity and justice, set aside impugned order of learned CIT(A) dated 08.10.2014 confirming levy of penalty under section 272A(2)(k) of Act for both assessment years 2009-10 and 2010- 11 and restore this matter to file of learned CIT(A) for disposal/ adjudication on merits after affording assessee adequate opportunity of being heard and to file details/submissions required. It is accordingly ordered. Consequently, grounds of assessees appeals are allowed for statistical purposes. 4. In result, assessees appeals for assessment years 2009-10 and 2010-11 are allowed for statistical purposes. Order pronounced in open court on 7th October, 2016. Sd/ Sd/- (Sandeep Gosain) (Jason P. Boaz) Judicial Member Accountant Member Mumbai, Dated: 7th October, 2016 Copy to: 1. Appellant 2. Respondent 3. CIT(A) -14, Mumbai 4. CIT (TDS), Mumbai 5. DR, F Bench, ITAT, Mumbai By Order //True Copy// Assistant Registrar ITAT, Mumbai Benches, Mumbai n.p. M/s. Varad Fashions P. Ltd. v. Addl. CIT (TDS), Range-3, Mumbai