LENZING POLYPACKS LTD.,NEW DELHI vs. ITO, WARD-15(2), NEW DELHI

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ITA 3517/DEL/2019Status: DisposedITAT Delhi30 December 2022AY 2006-073 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that the quantum appeal for the same assessment year had set aside the additions on which the penalty was levied. Therefore, the penalty issue was also remanded to the Assessing Officer for a fresh decision.

What were the facts?

The Assessing Officer made additions on account of accommodation entries and commission paid. Penalty proceedings were initiated and confirmed by the Commissioner (Appeals). The assessee appealed against the penalty order.

What were the issues?

Whether penalty under Section 271(1)(c) can be sustained when the underlying additions have been set aside or are subject to fresh adjudication. The validity of the penalty in light of the outcome of the quantum appeal.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 148,Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “E”: NEW DELHI

Before: SHRI SHAMIM YAHYA & SHRI NARENDER KUMAR CHOUDHRY

Hearing: 29.12.2022Pronounced: 30.12.2022

O R D E R PER N.K.CHOUDHRY, JM:

The Assessee has preferred the instant appeal against the order dated 15.02.2019 passed by the Ld. Commissioner of Income-tax (Appeals)-5, New Delhi, (in short “Ld. Commissioner”), pertaining to the assessment year 2009-10.

2.

In the instant case vide assessment order dated 13.03.2014 passed u/s 143(3)/148 of the Income-tax Act, 1961 (in short “the Act”), additions of Rs. 90,00,000/- on account of accommodation entries and Rs. 1,80,000/- on account of commission paid by the Assessee have been made. The Assessing officer also initiated penalty proceedings u/s 271(1)(c) of the Act and vide order dated 22.09.2017 levied the penalty to the tune of Rs. 30,89,988/- on the income of Rs. 91,80,000/- sought to be evaded.

3.

The Assessee being aggrieved, challenged the penalty order before the learned Commissioner, who vide order dated 15.02.2019 affirmed the penalty levied u/s 271(1)(c) of the Act, against which the Assessee is in appeal before us.

4.

None appeared on behalf of the Assessee, inspite of sending notice for the date of hearing on 29.12.2022. Therefore, we deem it appropriate to decide this appeal as ex parte.

5.

At the outset the Ld. DR fairly submitted that the Tribunal in quantum appeal decided on 13.11.2019, for the assessment year in question itself, set aside the addition on the basis of which penalty was levied and restored the issue concerning the addition referred to above to the file of the Assessing officer, with a direction to decide the issue afresh in accordance with law, after giving due opportunity of being heard to the Assessee.

6.

Considering the peculiar facts and circumstances, the issue qua levy of penalty is also remanded to the file of the Assessing Officer for decision afresh, suffice to say by providing reasonable opportunity of being heard to the Assessee.

7.

In the result, appeal filed by the Assessee stands allowed for statistical purposes.

Order pronounced in open court on 30.12.2022.

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