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Income Tax Appellate Tribunal, DEHRADUN BENCH, DEHRADUN
Before: SHRI R.K. PANDA & SHRI V.P. RAO
This appeal by the assessee is directed against the order dated 24.02.2017 of CIT(A) arising from the penalty order passed u/s. 271(1)(c) of the Income-tax Act for the assessment year 2011-12. The assessee has raised following grounds : “1. That in facts and circumstances of the case, the Learned CIT has erred wrong in sustaining the penalty of Rs. 15,32,400/- in facts & law, totally ignoring the judgment of the Hon'ble Supreme Court in the case of Dr. Sarita Milind Davare & Anr. vs ACIT & Anr reported in ITA No.
2187/Mum/2014,1789/MUM/2014 dated 21.012.2016 48 CCH 0312 submitted vide letter dated 30.01.2017 received in the office of CIT(A), Kanpur on 02.02.2017 the same is unjust & unfair.
That the imposition of the penalty for the wrong addition made in the assessment order by applying the provisions of section 36(1)(iii)of the IT Act, 1961 does not automatically prove that the assessee has concealed his particulars of income or has furnished any inaccurate particulars of income. The imposition of penalty on wrong facts is erroneous and unwarranted.
The AO has not brought on record or communicated any specific charge, whether penalty is being initiated for concealment of income or for furnishing of inaccurate particulars of income, in the absence of same imposition of penalty and confirmed by CIT (A) is bad at Law.
That in facts and circumstances of the case, the AO has not recorded any satisfaction for imposition of the penalty nor had applied her mind while initiating the penalty or while imposing the penalty.
That in facts and circumstances of the case, being the search case u/s 132 which took place on 21.10.2010 imposition of penalty u/s 271(1)(c) is erroneous and illegitimate.
6. That in the facts and circumstances of the case, the penalty as imposed by AO and confirmed by CIT (A) amounting to Rs. 15,32,400/- may please be deleted/ cancelled.
That the appellant assail their right to alter, submit additional Grounds of Appeal
, if required, at the time of hearing of the appeal.
8. That in fact and circumstance of the case, appellant be permitted to add or delete ay grounds of appeal.
2. At the time of hearing, learned AR of the assessee has pointed out that the quantum appeal has been decided by this Tribunal in favour of the assessee, quashing the assessment and the additions made by the Assessing Officer against which penalty was levied u/s. 271(1)(c) of the Income-tax Act has been deleted vide order dated 08.02.2019 in ITA No. 2026/Del/2015. Thus, the ld. AR has submitted that when the addition has been deleted by this Tribunal, penalty is not sustainable.
3. On the other hand, ld. DR has not disputed the fact that the Tribunal has quashed the assessment itself vide order dated 08.02.2019. 4. Having considered the rival submissions as well as relevant material on record, at the outset we note that in the quantum appeal, the Tribunal vide its order dated 08.02.2019 in has quashed the assessment in para 13 to 14.2 as under : “13. We have perused submissions advanced by both sides in light of records placed before us. 14. In assessment order for year under consideration Ld. AO refers to date of search to be 21/10/10, whereby, relevant assessment year falls in block of 6 years. 14.1. It is pertinent to note that Ld.CIT (A) for preceding assessment year 2007-08 has returned a factual finding that, no search under section 132 was conducted in name of assessee nor any panchnama drawn, and therefore basis and initial condition for initiating proceedings under section 153A does not exist. The impugned order passed by Ld.CIT (A) for assessment year 2007-08, has been considered in aforestated paragraphs. It is observed that Ld.CIT (A) therein has analysed panchnamas drawn, which was part of remand report, forwarded by Assessing Officer dated 08/10/14 before making such factual observation. Under such circumstances, in our considered view limitation for issuance of notice under section 143 (2) has to be reckoned from date of filing of original return of income, for year under consideration being 21/09/11 and notice under section 143 (2) has been issued on 06/03/13, which is beyond limitation period. There are plethora of decisions by Hon’ble Supreme Court in case of ACIT vs Hotel blue Moon reported in (2010) 188 Taxmann 113, which opines settled legal position that, requirement of issuance of notice under section 143 (2) within period of limitation is mandatory for completing assessment under section 143(3) of the Act. 14.2. Thus, in our considered opinion, legal ground raised by assessee stands allowed, and assessment order dated 28/03/13 is quashed and set-aside. As we have allowed legal ground raised by assessee, grounds raised challenging addition confirmed by Ld.CIT(A) becomes academic in nature and therefore has not adjudicated upon.
5. Since the assessment itself has been quashed by the Tribunal, therefore, the penalty levied u/s. 271(1)(c) of the Act would not survive and liable to be deleted. We order accordingly.