DCIT CIRCLE-18(1), NEW DELHI vs. NEMINATH INDUSTRIES PVT. LTD., NEW DELHI

This appeal filed by the Revenue is against the order of the ld. Commissioner of Income Tax (Appeals)-36 [hereinafter referred to as CIT (Appeals)] New Delhi, dated 17.01.2019 in deleting penalty levied under Section 271(1)(c) of the Income Tax Act, 1961 (the Act) for assessment year 2010-11. 1

In spite of issue of notice none appeared on behalf of the assessee. This appeal is disposed of on hearing the ld. DR.

We have perused the order of the ld. CIT (Appeals) and noticed that penalty levied under Section 271(1)(c) of the Act was deleted by the ld. CIT (Appeals) since the Tribunal deleted the quantum addition of Rs.3,95,00,000/- in respect of advances written off by the assessee. Since the Tribunal deleted the addition 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. We further observed from the grounds of appeal of the Revenue that Tribunal order in quantum proceedings has been challenged by the Revenue before the Hon’ble High Court and the same is still pending. The ld. DR could not bring to our notice further developments in this matter. 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 2006-07 is set aside and the penalty is deleted.

In the result, appeal of the Revenue is dismissed.