THE SPUNPIPE & CONSTRUCTION CO.(BARODA)PVT.LTD.,BARODA vs. THE ACIT.,CIRCLE-4, BARODA

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ITA 2897/AHD/2015Status: DisposedITAT Ahmedabad01 February 2019AY 2008-092 pages

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

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that since the original penalty order had already been deleted by a previous Tribunal order due to the deletion of the quantum addition, the rectification of that penalty order had become an academic exercise. Therefore, the appeal against the rectification was dismissed.

What were the facts?

The Assessing Officer (AO) passed a penalty order under section 271(1)(c) and later rectified it. The assessee appealed the rectification, arguing that the reasons in the penalty order were debatable and could not be rectified. The CIT(A) dismissed the appeal, confirming the rectification.

What were the issues?

Whether a penalty order, whose underlying addition has been deleted, can be rectified. The academic nature of the rectification appeal when the penalty itself has been deleted.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 154

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “C” BENCH, AHMEDABAD

Before: SHRI RAJPAL YADAV & SHRI AMARJIT SINGH

For Appellant: Shri A.C. Shah
Hearing: 21/01/2019Pronounced: 01/02/2019

PER RAJPAL YADAV, JUDICIAL MEMBER: Assessee is in appeal before the Tribunal against order of the ld.CIT(A)-2, Baroda dated 20.7.2015 passed for the Asstt.Year 2008-09.

2.

Brief facts of the case are that a penalty order under section 271(1)(c) of the Act was passed on 25.3.2013. The ld.AO issued notice under section 154 for rectification of this penalty order. In the opinion of the AO, certain reasons incorporated in para 3.4 of the penalty order required to be expunged because it is an inadvertent mistake. After hearing the assessee, the ld.AO has modified the penalty order, and rectified the same vide order dated 29.4.2014. Dissatisfied with the rectification, assessee filed appeal before the ld.CIT(A)

ITA No.2897/Ahd/2015 2 contending that reasons given in the penalty order cannot be rectified. It is a debatable issue. However, the ld.CIT(A) was not satisfied with the contentions of the assessee and dismissed its appeal. In a way, the ld.CIT(A) has confirmed the rectification order. Before us, the ld.counsel for the assessee contended that original penalty order dated 25.3.2013 was challenged before the ld.CIT(A) and ultimately litigation travelled to the Tribunal in ITA No.286/Ahd/2016. The Tribunal has allowed this appeal vide order dated 10.4.2018 wherein the Tribunal has deleted penalty by observing that addition stands deleted. He placed on record copy of the Tribunal’s order.

3.

With the assistance of the ld.representatives, we have gone through the record carefully. Since penalty impugned in the original penalty order has been deleted, rectification of that order on account of incorporating certain reasons, is just an academic exercise in the present litigation, because allowance or dismissal of this appeal is not going to affect the assessee in any manner. Penalty has already been deleted. It is deleted on account of deletion of quantum addition. In such situation, this appeal becomes redundant, and accordingly dismissed.

4.

In the result, appeal of is dismissed as indicated above.

Order pronounced in the Court on 1st February, 2019 at Ahmedabad.

Sd/- Sd/- (AMARJIT SINGH) (RAJPAL YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER

Ahmedabad; Dated 01/02/2019

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