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Facts
The Assessee's appeal is against an order partially allowing an appeal against a penalty order. The Assessee contended that the CIT(A) adjudicated the penalty appeal without waiting for the decision on the quantum appeal, which formed the basis of the penalty.
Held
The Tribunal found merit in the Assessee's ground and set aside the CIT(A)'s order. The CIT(A) was directed to adjudicate the penalty appeal afresh after considering the decision on the quantum appeal.
Key Issues
Whether the CIT(A) erred in adjudicating a penalty appeal before the decision on the quantum appeal, which formed the basis for the penalty.
Sections Cited
271(1)(c)
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Income Tax Appellate Tribunal, “G” BENCH, MUMBAI
order : 23.12.2025 O R D E R [ Per Rahul Chaudhary, Judicial Member:
1. 1. The present appeal preferred by the Assessee is directed against the order, dated 17/10/2025, passed by the National Faceless Appeal Centre (NFAC), [hereinafter referred to as ‘the CIT(A)’] whereby the Ld. CIT(A) had Partly Allowed the appeal against the Penalty Order, dated 25/08/2015, passed under Section 271(1)(c) of the Income Tax Act, 1961 [hereinafter referred to as ‘the Act’] for the Assessment Year 2009-2010.
2. The Assessee has raised following grounds of appeal :
1. On the facts and circumstances of the case and in law, the authorities below had erred in sustaining a penalty of Assessment Year 2009-2010 Rs.3,56,939/- without adjudicating the issue on merits and ahead of decision of quantum appeal in the matter, and the reason assigned for levying of such penalty were wholly wrong inconsistent with the facts of the case and against the principles of the I.T.Act, 1961 and rules made thereunder.”
We have perused the material on record and have taken into consideration the submission advanced by the Learned Departmental Representative.
The Assessee is aggrieved by the fact that the Learned CIT(A) has adjudicated the appeal preferred by the Assessee against the Penalty Order, dated 25/08/2025, passed under Section 271(1)(c) of the Act without awaiting the decision of the Commissioner of Income Tax (Appeals) on the appeal preferred by the Assessee against the Assessment Order challenging the additions which formed the basis of levy of penalty. On perusal of the order impugned by way of present appeal passed by the Learned CIT(A), we find that the Assessee had requested the Learned CIT(A) to await the decision of the quantum appeal preferred by the Assessee. However, rejecting the aforesaid submissions the Learned CIT(A) passed the impugned order. Therefore the factual averment made in the grounds of appeal and statement of facts is consistent to the material on record. Finding merit in the ground raised by the Assessee, we set aside the impugned order, dated 17/10/2025, passed by Learned CIT(A) with the directions to adjudicate the appeal afresh after taking into consideration the decision of Learned Commissioner of Income Tax (Appeals) in the quantum appeal preferred by the Assessee. The Assessee is directed to take necessary steps expedite adjudication of the quantum appeal and place a copy of this order before the Learned Commissioner of Income Tax (Appeals). In terms of aforesaid Ground No. 1 raised by the Assessee is allowed for statistical purposes.
5. In the said appeal preferred by the Assessee is treated is allowed for 2 Assessment Year 2009-2010 statistical purposes