THE DEPUTY COMMISSIONER OF INCOME TAX (EXEMPTIONS), CIRCLE-1, AHMEDABAD vs. GUJARAT INDUSTRIAL DEVELOPMENT CORPORATION, GANDHINAGAR

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ITA 2161/AHD/2017Status: DisposedITAT Ahmedabad27 March 2019AY 2011-122 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 held that since the quantum appeal was deleted by the Hon'ble Tribunal, the penalty levied by the AO was not sustainable. Therefore, the CIT(A) was correct in allowing the appeal against the penalty.

What were the facts?

The Revenue appealed against an order deleting a penalty imposed under Section 271(1)(c) for the assessment year 2011-12. The penalty was levied after the assessee's total income was determined at Rs. 627,67,58,990/-. The CIT(A) had deleted the penalty, relying on a prior Tribunal order in the quantum appeal.

What were the issues?

Whether a penalty under Section 271(1)(c) is sustainable when the underlying quantum appeal has been deleted. The sustainability of a penalty when the primary addition is deleted.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, AHMEDABAD – BENCH ‘B’

Before: SHRI AMARJIT SINGH

For Appellant: Shri Krishna Vyas, CIT DR
Hearing: 08/02/2019Pronounced: 27/03/2019

PER MADHUMITA ROY- JM: The instant appeal filed by the Revenue against the order dated 25.07.2017 passed by the CIT(A)-9, Ahmedabad u/s. 271(1)(c) of the Income Tax Act 1961 (hereinafter referred to as ‘the Act’) for assessment year 2011-12.

2.

The assessee initially filed its return of income on 30.09.2011 showing deficit of Rs. 1241,42,01,337/- which was finalized u/s. 143(3) of the Act on 16.01.2014 determining total income of Rs. 627,67,58,990/-. The Ld. AO also initiated penalty proceedings u/s. 271(1)(c) of the Act.

3.

By and under an order dated 28.03.2016 the DCIT (Exemptions) Circle-1, Ahmedabad imposed a lump sum penalty of Rs. 9,96,210,794/- u/s. 271(1)(c) of the Act. In appeal the same was deleted by the order impugned relying upon the order

ITA No. 2161/Ahd/2017 A.Y. 2011-12 2

passed by the Hon’ble Tribunal dated. 10.01.2017 in quantum appeal copy whereof was handed over to as at the time of hearing by the Ld. AR.

The Ld. Counsel appearing for the assessee submitted before us that since the quantum appeal has been deleted by the Hon’ble Tribunal the penalty levied by the AO is not sustainable and hence he relied upon the order passed by the Ld. CIT(A)

4.

Having heard the Ld. Counsel appearing for the parties, having heard to the facts and circumstances of the case we find that since the quantum appeal has been deleted by the Hon’ble Tribunal the appeal preferred by the assessee against the order of penalty has been rightly allowed by the Ld. CIT(A). In fact the appeal preferred before us by Revenue become infructuous.

Hence the appeal is dismissed as infructuous. 5.

[Order pronounced in the Court on 27-03-2019.]

Sd/- Sd/- (AMARJIT SINGH) (MADHUMITA ROY) ACCOUNTANT MEMBER JUDICIAL MEMBER

Ahmedabad; Dated 27/03/2019 Tanmay True Copy आदेशक���त�ल�पअ�े�षत/Copy of the Order forwarded to : 1. अपीलाथ�/ The Appellant 2. ��यथ�/ The Respondent. 3. संबं�धतआयकरआयु�त/ Concerned CIT 4. आयकरआयु�त(अपील) / The CIT(A) 5. �वभागीय��त�न�ध, आयकरअपील�यअ�धकरण/ DR, ITAT, 6. गाड�फाईल / Guard file. आदेशानुसार/ BY ORDER,

उप/सहायकपंजीकार (Dy./Asstt.Registrar) आयकरअपील�यअ�धकरण, अहमदाबाद / ITAT, Ahmedabad

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