M/S HINGALJ METALS & ALLOYS PVT LTD,MUMBAI vs. CIT(A), NFAC,DELHI, MUMBAI

This appeal by the assessee is directed against the order of Commissioner of Income Tax(Appeals), National Faceless Appeal Centre, Delhi [in short ‘the CIT(A)’] dated 01/08/2022 for the assessment year 2009-10, confirming penalty levied u/s. 271(1)(c) of the Income Tax Act, 1961 [in short ‘the Act’].

This appeal is time barred by 33 days. The assessee has filed an application seeking condonation of delay. After perusing the application we are satisfied that the delay in filing of the appeal is not intentional but has occurred due to bonafide reasons stated in application. The delay of 33 days in filing of appeal is condoned and the appeal is admitted for hearing on merits.

Shri Dharmil Jhaveri appearing on behalf of the assessee submits that the Assessing Officer has levied penalty u/s. 271(1)(c) of the Act in respect of alleged bogus purchases. The Assessing Officer made addition of the entire alleged bogus purchases. The CIT(A) confirmed the assessment order. The assessee carried the issue in appeal before the Tribunal. The Tribunal in vide order dated 05/12/2019 has restored the issue to the file of CIT(A). The ld. Authorized Representative for the assessee submits that since the Tribunal has restored assessment proceedings back to the file of CIT(A), the present penalty proceedings are not sustainable. The ld. Authorized Representative for the assessee further pointed that the Tribunal in appeal by the assessee against levy of penalty u/s. 271(1)(c) of the Act for assessment years 2010-11 and 2011-12 has restored the appeal to the file of CIT(A).

Per contra, Shri Tejinder Pal Singh Anand representing the Department vehemently defended the impugned order and prayed for dismissing the appeal of assessee. However, ld. Departmental Representative fairly admitted that in quantum proceedings the appeal of assessee has been restored by the Tribunal to the CIT(A).

Both sides heard, orders of authorities below examined. We find that the Co-ordinate Bench in assessee’s appeal in against assessment for impugned assessment year has restored the appeal to the file of CIT(A) for fresh adjudication. Since, quantum proceedings have been restored to the First Appellate Authority, we deem it appropriate to restore the penalty proceedings u/s. 271(1)(c) of the Act as well to the CIT(A). The CIT(A) shall decide this appeal denovo after affording reasonable opportunity to the assessee for making the submissions. The assessee is directed to comply with the notices issued by the CIT(A). In case, the assessee fails to respond to the notices, the CIT(A) is at liberty to take adverse view. The impugned order is set-aside and the appeal is allowed for statistical purpose.