PAWAN KUMAR JINDAL,FARIDABAD vs. ITO WARD - 1(2), FARIDABAD

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ITA 114/DEL/2021Status: DisposedITAT Delhi04 August 2022AY 2006-074 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that since the quantum additions on which the penalty was levied had been deleted by a co-ordinate bench of the Tribunal, the penalty does not survive. Therefore, the penalty was directed to be deleted.

What were the facts?

The assessee's income was determined at Rs. 15,67,413/- after additions by the AO. The CIT(A) granted partial relief but confirmed additions of Rs. 8,00,000/- and Rs. 3,721/-. Subsequently, the AO levied a penalty of Rs. 2,88,590/- under Section 271(1)(c).

What were the issues?

The primary issue was whether penalty under Section 271(1)(c) could be sustained when the underlying additions were subsequently deleted by the ITAT.

Which sections of the Income-tax Act were involved?

Section 68,Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘H’, NEW DELHI

For Respondent: Shri M. Baranwal, Sr. D.R
Hearing: 01.08.2022Pronounced: 04.08.2022

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘H’, NEW DELHI BEFORE SH. ANIL CHATURVEDI, ACCOUNTANT MEMBER AND SH. NARENDER KUMAR CHOUDHARY, JUDICIAL MEMBER (Assessment Year : 2006-07) Pawan Kumar Jindal Vs. ITO C/o. Chaitira Gupta & Co. Ward – 1(2), CA H. No. 1865, Sec-9, Faridabad Faridabad, Haryana – 06 PAN No. AAGPJ 5960 J (APPELLANT) (RESPONDENT) Assessee by --None-- Revenue by Shri M. Baranwal, Sr. D.R. Date of hearing: 01.08.2022 Date of Pronouncement: 04.08.2022 ORDER PER ANIL CHATURVEDI, AM :

This appeal filed by the assessee is directed against the order dated 11.02.2015 of the Commissioner of Income Tax (Appeals)-Faridabad relating to Assessment Year 2006-07.

2.

Brief facts of the case as culled out from the material on record are as under :-

3. Assessee is an individual stated to be engaged in the business of iron pipes. Assessee filed his return of income for A.Y. 2006-07 on 30.10.2006 declaring total income of Rs.1,14,952/-. The case was selected for scrutiny and thereafter assessment was framed u/s 143(3) of the Act vide order dated 24.12.2008 and the total income was determined at Rs.15,67,413/-. Aggrieved by the order of AO, assessee carried the matter before CIT(A) who vide order dated 01.04.2011 granted partial relief to the assessee. Out of the addition of Rs.14,35,000/- made u/s 68 of the Act, CIT(A) deleted the addition to the extent of Rs.6,35,000/- and confirmed the addition of Rs.8,00,000/-. As far as the addition of Rs.17,461/- made on account of disallowance of interest is concerned, CIT(A) confirmed the addition to the extent of Rs.3,721/-. On the aforesaid additions that were confirmed by the CIT(A), AO vide order dated 22.02.2013, levied penalty of Rs.2,88,590/- u/s 271(1)(c) of the Act.

4.

Aggrieved by the order of AO, assessee carried the matter before CIT(A) who vide order dated 11.02.2015 in Appeal No.137/13-14 dismissed the appeal of the assessee. Aggrieved by the order of CIT(A), assessee is now in appeal and has raised the following grounds: “1. That having regard to facts and circumstances of the case, Ld CIT(A) has erred in law and on facts in confirming the penalty of Rs.2,88,590/- levied by the Ld AO u/s 271(1)(c) of the Act on account of alleged concealment of income.

2. That in any view of the matter and in any case, the levy of penalty is bad in law since the additions on which penalty has been levied since been deleted by Hon’ble ITAT.

3.

That the appellant craves the leave to add, alter or amend the grounds of appeal at any stage and all the grounds are without prejudice to each other.”

5. On the date of hearing, an adjournment application was moved by the Learned AR seeking adjournment. However, on perusing the grounds raised by assessee, we find that vide Ground No. 2, it is the contention of the assessee that the addition on which penalty has been levied itself has been deleted by Hon’ble ITAT. In view of these facts, we reject the request for adjournment and proceed with disposing of the appeal ex-parte qua the assessee.

6. Before us, Learned DR fairly conceded that the additions on which impugned penalty has been levied was deleted by Co- ordinate Bench of Tribunal vide order dated 18.03.2016 in ITA No.3557/Del/2011. He placed on record the copy of the aforesaid decision. He therefore submitted that in view of the aforesaid decision of Tribunal, the appeal be decided accordingly.

7.

We have heard the Learned DR and perused the material available on record. The issue in the present ground is with respect to the levy of penalty u/s 271(1)(c) of the Act. We find that the penalty has been levied on the addition that were upheld by CIT(A). We find that against the order of CIT(A), assessee had carried the matter before the Tribunal. The Co-ordinate Bench of Tribunal in order dated 18.03.2016 had deleted the quantum additions that were upheld by CIT(A). Before us, no material has been placed by Revenue to demonstrate that the order setting aside the quantum addition by the Tribunal has been set aside or over ruled by higher judicial forum. In such a situation, since the quantum addition itself has been deleted, the penalty of such addition does not survive. We therefore, direct the deletion of penalty that has been levied by AO and upheld by CIT(A). Thus the ground of assessee is allowed.

8.

In the result, appeal of the assessee is allowed.

Order pronounced in the open court on 04.08.2022

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