SHRI GOPAL MAHAJAN,BILASPUR vs. ITO, BILASPUR

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ITA 1572/CHANDI/2019Status: DisposedITAT Chandigarh15 December 2020AY 2007-083 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that the quantum proceedings were set aside and restored to the CIT(A). Therefore, the penalty order was also set aside and restored to the CIT(A) to be decided after the quantum appeal is decided.

What were the facts?

The assessee appealed against the CIT(A)'s order upholding a penalty. The assessee argued that the penalty order was decided before the quantum appeal on merits, which was still pending before the CIT(A). The ITAT had previously set aside the quantum proceedings to the CIT(A).

What were the issues?

Whether penalty can be upheld when the underlying quantum addition is still pending before the CIT(A). The procedural correctness of deciding penalty before the quantum appeal.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

आदेश/Order

Per Sanjay Garg, Judicial Member:

1.

The present appeal has been preferred by the assessee against the order dated 27.09.2019 of the Commissioner of Income Tax (Appeals), Palampur [hereinafter referred to as ‘CIT(A)’]

2.

The assessee in this appeal has taken following grounds of appeal:- -Chd/2019- Shri Gopal Mahajan, Bilaspur 2

1. That the order of Learned CIT(A), is against the law and facts of the case.

2. That the Ld. CIT(A) has grossly erred in deciding the penalty order prior to deciding of issue of quantum in appeal on merits specifically when various letters and Order of Hon'ble ITAT, Chandigarh was submitted during hearing to prove the point that quantum proceedings have been set aside to the file of CIT(A) by the Hon'ble ITAT, Chandigarh.

3. That the Ld. CIT(A) is not justified upholding penalty on the issue/addition of Rs. 4,72,831/- on account of unconfirmed balances of creditors, especially when the said issue on merits is still pending before the CIT(A) in quantum proceedings.

4. That the Ld. C1T(A) is otherwise also not justified while upholding penalty on the issue which does not warrant levy of penalty.

5. That the appellant craves, leave to add or amend any grounds of appeal.

3. At the outset, Ld. Counsel for the assessee has submitted that in this case the quantum proceedings have been set aside and the matter is restored to the file of the CIT(A) by the Tribunal vide order dated 27.3.2018 in ITA No.1163/Chd/2016. A copy of the said order has been placed on record.

5.

The Ld. DR has also fairly conceded the aforesaid factual matrix.

6.

We have gone through the record and order dated 27.3.2018 passed by the Tribunal in relating to assessment year 2007-08, wherein, the order of the CIT(A) is set aside and the quantum -Chd/2019- Shri Gopal Mahajan, Bilaspur 3 proceedings have been restored back to the file of the CIT(A). Since the matter in the quantum proceeding has been restored back to the CIT(A), accordingly, the order of the CIT(A) in penalty proceedings is also set aside and the matter is restored back to the file of the CIT(A) to decide it after arriving at the decision in the assessee’s quantum appeal.

In the result, the appeal of the assessee stands allowed for statistical purposes.

Order pronounced on 15.12.2020.

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