IN THE INCOME TAX APPELLATE TRIBUNAL PATNA BENCH VIRTUAL HEARING AT KOLKATA BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI SANJAY AWASTHI, ACCOUNTANT MEMBER ITA No. 33/PAT/2025 Assessment Year: 2021-22 Rohit Khandelwal AC/DCIT, Central Circle, MZF S/o Bijay Khandelwal Main Road, Jaynagar Near Surekha Vs Atithi Bhawan, Madhubani, Bihar-847226.

(PAN: JAGPK8824M)

(Appellant) (Respondent)

Present for:

Appellant by : Shri Sanjeev Kr. Anwar, Advocate Respondent by : Shri Ashwani Kr. Singal, JCIT Date of Hearing : 27.02.2025 Date of Pronouncement : 27.02.2025

O R D E R

Per Bench :

This is an appeal filed by the assessee against the order of the Ld.

Commissioner of Income Tax (Appeals), Patna-3 [hereinafter referred to as “the Ld. CIT(A)”] vide order no. ITBA/APL/S/250/2024-25/1070658454(1) dated 26.11.2024 passed u/s. 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for AY 2021-22 confirming the levy of penalty levied u/s. 271AAC(1) of the Act.

2. Shri Sanjeev Kr. Anwar, Advocate appeared on behalf of the assessee and Shri Ashwani Kr. Singal, JCIT appeared on behalf of the revenue.

3. It was submitted by the Ld. AR that there was an information received from the authorities designated for Bihar Assembly Election 2020 that cash amounting to Rs.1,11,05,650/- had been intercepted by SST (Static Surveillance Team) at Bishanpur Thana, Darbhanga on 06.10.2020 during the course of vehicle checking. It was submitted that this issue relates to the assessment year 2021-22. The assessee had filed his return of income on 20.02.2022 disclosing the amount of Rs.1,11,05,650/- and had paid the tax u/s. 115BBE of the Act. The return filed by the assessee came to be accepted and assessment u/s. 143(3) came to be completed on 23.03.2022. Penalty proceedings u/s. 271AAC(1) were initiated. It was the submission of the Ld. AR of the assessee that as per the proviso to section 271AAC(1), penalty was not leviable in so far as the assessee filed his return u/s. 139 of the Act and had also disclosed his income and paid taxes thereon u/s. 115BBE of the Act. It was the submission that the Assessing Officer did not accept the contention of the assessee and had held that as the return was filed in response to a notice issued u/s. 142(1) of the Act on 25.01.2022, proviso to section 271AAC(1) would not come into play and the penalty was levied. On appeal, the Ld. CIT(A) confirmed the penalty levied. It was the submission that for the Assessment Year was 2021-22, the financial year ending was on 31.03.2021. Accordingly, the time limit for filing the return u/s. 139(1) is 31.07.2021. Notice u/s. 142(1) had been issued on 25.01.2022. The time limit for filing the return u/s. 139(4) was 31.03.2022. It was the submission that the return filed by the assessee was u/s. 139(4). It was further submitted that proviso to section 271AAC(1) refers to return filed u/s. 139 and thus, does not differentiate between the return filed u/s. 139(1) or 139(4) or 139(5) of the Act. It was the submission that as return had been filed u/s. 139, the proviso came into play and that penalty was liable to be deleted.

4. In reply, the Ld. Sr. DR vehemently supported the order of the Assessing Officer and the Ld. CIT(A). It was the submission that the notice u/s. 142(1) had been issued on 25.01.2022 and it was only after the notice was issued u/s. 142(1) that the assessee filed his return on 20.02.2022. It was the submission that the proviso to section 271AAC(1) of the Act refers to and the section 139 has to to be read as sec. 139(1). It was the prayer that the orders of the Ld. CIT(A) and that of the Assessing Officer have to be upheld.

5. We have considered the rival submissions. For better understanding of the proviso, it is worthwhile to extract the proviso to section 271AAC(1)

which reads as follows:

“271AAC(1) The Assessing Officer may, notwithstanding anything contained in this Act other than the provisions of section 271AAB, direct that, in a case where the income determin