DEPUTY COMMISSIONER OF INCOME-TAX, PANVEL CIRCLE, RAIGAD vs. M/S. AGARWAL METAL AND ALLOYS, RAIGAD

PDF · subscribers
ITA 271/PUN/2018Status: DisposedITAT Pune15 March 2021AY 2007-084 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the order of the CIT(A) deleting the penalty. This was because all the additions/disallowances that formed the basis for the penalty were subsequently deleted by the Tribunal, CIT(A), or the AO.

What were the facts?

The Assessing Officer imposed a penalty under Section 271(1)(c) based on several additions/disallowances. The Commissioner (Appeals) deleted the penalty. The Revenue appealed this deletion.

What were the issues?

Whether penalty under Section 271(1)(c) can be sustained when the underlying additions/disallowances have been deleted. The validity of penalty imposition in light of subsequent deletions.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 69C,Section 80IB

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE – VIRTUAL COURT

Before: SHRI R.S. SYAL & SHRI S.S.VISWANETHRA RAVI

For Appellant: Shri Sachin Kumar
For Respondent: Shri S.P. Walimbe

PER R.S. SYAL, VP : This appeal by the Revenue is directed against the order passed by the CIT(A)-3, Thane on 06-11-2017 deleting the penalty imposed by the Assessing Officer (AO) u/s.271(1)(c) of the Income- tax Act, 1961 (herein also called ‘the Act’) in relation to the assessment year 2007-08.

2.

Briefly stated, the facts of the case are that the assessee filed its return declaring total income of Rs.97,08,680/-. Certain additions/disallowance were made in the assessment order. The AO imposed penalty u/s. 271(1)(c) of the Act amounting to Rs.72,60,175/-, which came to be deleted in the first appeal.

3.

We have heard the rival submissions and gone through the relevant material on record. It is seen that the AO imposed the instant penalty with reference to the following 4 additions/disallowances :

1.

Addition of Rs.59,26,301/- was made u/s.69C on account of undervaluation of the imports as against actual import price and for the period 1.04.2006 to 16.05.2006.

1.

2. Addition of Rs.13,52,86,734/- was made u/s.69C on account of undervaluation of the imports as against actual import price and for the period 17.05.2006 to 31.03.2007.

3. Addition of Rs.1,92,62,303/- was made on account of highly fluctuating GP and NP ratio, estimated at 7.07% of sales which worked out to Rs.7,97,86,242/- as against the declared value of Rs.6,05,22,940/- as per the P&L A/c.

4. Disallowances Rs.23,06,846/- in respect of interest income u/s.80IB.

4.

The first addition of Rs.59,26,301/-, which constituted the foundation for the imposition of penalty on account of undervaluation of imports, stands finally deleted by the Tribunal.

Insofar as the second addition of Rs.13,52,86,734/- on account of undervaluation of imports is concerned, the ld. AR stated that the ld. CIT(A) allowed relief in the appeal and the Revenue did not file any further appeal before the Tribunal. The third addition of Rs.1,92,62,303/- was made on account of estimation of GP rate which as per the ld. AR got deleted by the Tribunal. The last disallowance of Rs.23,06,846/- is in respect of interest income vis- à-vis its eligibility of deduction u/s.80IB. The Tribunal restored this matter to the file of AO and the AO deleted the disallowance. The ld. DR has not controverted the above factual position stated by the ld. AR. Thus, it is seen that all the items on the basis of which penalty was imposed by the AO stand came to be deleted either by the Tribunal or the CIT(A) or the AO in the order giving effect.

Since no disallowance in this regard survives, there can be no question of confirmation of any penalty. We, therefore, uphold the impugned order deleting the penalty.

5.

In the result, the appeal is dismissed.

Order pronounced in the Open Court on 15th March, 2021.

More judgments on Section 271(1)(c)

All 25,141 judgments and leading authorities on Section 271(1)(c) →

Recent GST High Court judgments

Search GST case law →