ACIT CIRCLE 54(1), NEW DELHI vs. RITU MISHRA, GURGAON

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ITA 6019/DEL/2019Status: DisposedITAT Delhi17 June 2022AY 2009-105 pages

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

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the CIT(A)'s decision to delete the penalty on the addition related to suppressed gross profits, as the underlying addition was no longer valid. The Revenue failed to provide any material to counter the CIT(A)'s findings.

What were the facts?

The assessee's income was determined at a higher amount than declared, leading to a penalty under Section 271(1)(c). The CIT(A) deleted the penalty on a portion of the addition related to suppressed gross profits, as that addition had been deleted in prior appellate proceedings.

What were the issues?

Whether penalty under Section 271(1)(c) can be levied when the addition on which it was based has been deleted in appeal. The validity of penalty levied on disallowance under Section 40(a)(ia).

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 144,Section 145,Section 40(a)(ia)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCHES “F” : DELHI

Before: SHRI ANIL CHATURVEDI & SHRI N.K. CHOUDHARY

Hearing: 14.06.2022Pronounced: 17.06.2022

ORDER PER ANIL CHATURVEDI, A.M.

This appeal by Revenue has been directed against the Order of the Ld. CIT(A)-35, New Delhi, dated 08.04.2019 relating to the A.Y. 2009-2010.

2.

The relevant facts as culled from the material on record are as under :

2 ITA.No.6019/Del./2019 Smt. Ritu Mishra, Gurgaon. 2.1. The assessee is an individual and proprietor of M/s. K.K. International, New Delhi. The assessee filed return of income for the A.Y. 2009-10 on 30.09.2009 declaring income of Rs.41,78,820/-. The case was selected for scrutiny. Thereafter, assessment was framed under section 144(1) read with section 145(3) of the I.T. Act, 1961 vide order dated 29.12.2011 and the total income was determined at Rs.4,00,78,580/- by inter alia making addition on account of suppressed gross profits of Rs.2,59,27,998/- and disallowance under section 40(a)(ia) amounting to Rs.98,21,762/-. On the aforesaid disallowances/additions made by the A.O, he vide order dated 27.03.2015 levied penalty of Rs.1,22,02,328/- under section 271(1)(c) of the I.T. Act, 1961.

2.2. Aggrieved by the order of the A.O. assessee carried the matter before the Ld. CIT(A) who granted partial relief to the assessee by deleting the penalty on the addition of Rs. 2,59,27,998/- on account of increase in gross profit. While deleting the penalty on the aforesaid addition, he noted that the addition has been deleted in appellate order

3 ITA.No.6019/Del./2019 Smt. Ritu Mishra, Gurgaon. and, therefore, the penalty on such addition does not survive. With respect to the addition of Rs.35,87,182/- made under section 40(a)(ia), he upheld the levy of penalty.

3.

Aggrieved by the order of Ld. CIT(A) to the extent of relief granted by him, the Revenue is now in appeal before the Tribunal and has raised the following ground :

“On the facts and circumstances of the case, the CIT(A) has erred in deleting penalty of Rs.1,22,02,328/- levied by the A.O. under section 271(1)(c) of the I.T. Act, 1961 for concealment of income.”

4.

On the date of hearing, none appeared on behalf of the assessee despite notice of hearing that was issued. We, therefore, proceed to dispose of the appeal ex-parte qua the assessee, after hearing the Ld. D.R.

5.

Before us, the Ld. D.R. supported the order of A.O.

6.

We have heard the Ld. D.R. and perused the material on record. We find the Ld. CIT(A) while deleting the penalty on the addition of increase in G.P. has given a 4 ITA.No.6019/Del./2019 Smt. Ritu Mishra, Gurgaon. finding that the addition on which the impugned penalty has been levied has been deleted in the appellate proceedings and, therefore, the penalty on such addition does not survive. Before us, no material has been placed by the Revenue to point-out any fallacy in the findings of the Ld. CIT(A) nor has Revenue placed any material to demonstrate that the addition on which the impugned penalty has been levied has been upheld by higher Judicial Forum. In such circumstances, we find no reason to interfere with the order of the Ld. CIT(A) and thus dismiss the ground of the Revenue.

7.

In the result, appeal of the Revenue is dismissed.

Order pronounced in the open court on 17.06.2022.

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