ADDL.CIT, SPECIAL RANGE-6, NEW DELHI vs. NTPC LTD, NEW DELHI

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ITA 2800/DEL/2018Status: DisposedITAT Delhi01 September 2022AY 2008-094 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal noted that the quantum additions, which formed the basis for the penalty, had already been deleted by a previous ITAT order. Therefore, the penalty order could not survive.

What were the facts?

The Revenue appealed the deletion of penalty under Section 271(1)(c) by the CIT(A) for Assessment Year 2008-09. The penalty was levied on additions made by the Assessing Officer regarding various expense claims and sales recognition.

What were the issues?

Whether penalty under Section 271(1)(c) can be sustained when the underlying additions/disallowances have been deleted by a higher appellate authority.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

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Income Tax Appellate Tribunal, [ DELHI BENCH “E” : DELHI ]

Before: SHRI ANIL CHATURVEDISHRI CHALLA NAGENDRA PRASAD

For Appellant: Ms. Supriya Mehta, C. A.;
For Respondent: Ms. Rinku Singh
Hearing: 01/09/2022

आदेश / O R D E R PER C. N. PRASAD, J. M. :

1.

This appeal filed by the Revenue is against the order of the ld. Commissioner of Income Tax (Appeals)-34 [hereinafter referred to as CIT (Appeals)] New Delhi, dated 29.01.2018 in deleting penalty levied under Section 271(1)(c) of the Income Tax Act, 1961 (the Act) for assessment year 2008-09.

2.

The Revenue has raised the following grounds of appeal:-

“1. Whether on facts and in circumstances of the case, the Ld. CIT(A) is legally justified in deleting the penalty u/s 271 (1)( c) of the income Tax Act, 1961 (hereinafter referred to as "Act") on additions in respect of the following issues by ignoring finding of facts recorded by the Assessing officer (hereinafter referred to as "AO") that the assessee had admittedly debited patently wrong claim in respect of the expenses and also without appreciating the fact that the assessee had failed to discharge its onus to substantiate its claim in this regard: a) Interest paid to SEBs (State Electricity Boards); b) Reversal of Sales consequent to CERC (Central Electricity Regulatory Commission) order; c) Reversal of Sales in FY 2007-08; d) Recognition of Sales to SEBs in FY 2007-08; e) Disallowance of depreciation on mobile phones; f) Disallowance of depreciation on additional depreciation.

2. Whether on facts and in circumstances of the case, the Ld. CIT(A) is legally justified in not upholding the penalty u/s 271(1)(c) of the Act imposed by the AO by ignoring the fact that the assessee had taken a chance by making a patently incorrect and unsubstantially claim and the decision of Hon'ble jurisdictional High court in case of CIT Vs Zoom Communication Pvt. Limited (2010) 327 ITR 510, CIT vs NG Technologies Limited (2015) ITR 7, CIT Vs Escorts Finance Limited (2010) 328 ITR 44 and CIT Vs Harparshad and Company Limited (2010) 328 ITR 53? “

3.

Both the parties placed copy of the ITAT order in dated 5.08.2022 and submitted that the Tribunal deleted the quantum addition made in the assessment order by the Assessing Officer.

4.

We have perused the order of the ld. CIT (Appeals) and considering the submission of both parties and since the Tribunal in the order passed in dated 5.08.2022 deleted the additions/disallowances made in the assessment order passed under Section 143(3) of the Act which was the foundation for imposition of penalty under Section 271(1)(c) of the Act, the penalty order will not survive. In the circumstances the penalty order passed by the Assessing Officer imposing penalty under Section 271(1)(c) of the Act for the assessment year 2008-09 is set aside and the penalty is deleted.

5.

In the result, appeal of the Revenue is dismissed.

Order pronounced in the open court on : 01/09/2022.

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