SRI.E.UMMER BAVA,MALAPPURAM vs. THE ACIT, TIRUR

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ITA 357/COCH/2015Status: DisposedITAT Cochin07 July 2020AY 2005-062 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal held that since the Supreme Court deleted the addition of Rs. 35 lakh, the penalty related to that amount must also be deleted. However, the penalty on the remaining addition of Rs. 2 lakh, which has attained finality, is to be sustained.

What were the facts?

The assessee's appeal concerns the penalty imposed under Section 271(1)(c) for the assessment year 2005-2006. The addition of Rs. 37 lakh in the quantum assessment was reduced by the Supreme Court to Rs. 2 lakh.

What were the issues?

Whether penalty under Section 271(1)(c) is justified when the primary addition under Section 68 was substantially deleted by a higher court.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, COCHIN BENCH, COCHIN

Before: Shri Chandra Poojari, AM & Shri George George K, JM

Hearing: 07.07.2020Pronounced: 07.07.2020

This appeal at the instance of the assessee is directed against the order of the CIT (Appeals) dated 20.03.2015. The relevant assessment year is 2005-2006.

2.

The solitary issue raised is whether the CIT(A) is justified in confirming the imposition of penalty u/s 271(1)(c) of the I.T.Act.

3.

At the very outset, we noticed that as regards the quantum assessment, the assessee has succeeded before the Hon’ble Apex Court (Civil Appeal No.1246 of 2020 judgment dated February 7, 2020). The Hon’ble Apex Court, out of the total addition of Rs.37 lakh in the quantum assessment, had 2 Sri.E.Ummer Bava. deleted Rs.35 lakh being the addition made u/s 68 of the I.T.Act. Since the Hon’ble Apex Court had deleted the addition of Rs.35 lakh, the penalty with reference to the said addition, necessarily have to be deleted. As regards the addition of Rs.2 lakh, the same has attained finality in the quantum assessment, hence, penalty on the quantum addition of Rs.2,00,000 is to be sustained. It is ordered accordingly.

4.

In the result, the appeal filed by the assessee is partly allowed. Order pronounced on this 07th day of July, 2019.

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