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Facts
The assessee appealed against an order levying a penalty, which was based on an assessment order. The assessment order itself had been quashed by a coordinate bench of the tribunal.
Held
The Tribunal held that since the foundation of the penalty (the assessment order) was collapsed, the penalty also could not stand. Therefore, the penalty was deleted.
Key Issues
Whether a penalty, levied based on an assessment order that has been subsequently quashed, can be sustained?
Sections Cited
250, 143(3), 147, 271(1)(C)
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Income Tax Appellate Tribunal, MUMBAI BENCH “C”, MUMBAI
Before: SHRI NARENDER KUMAR CHOUDHRY & MS. RENU JAUHRI
O R D E R
Per : Narender Kumar Choudhry, Judicial Member:
This appeal has been preferred by the Assessee against the order dated 28.05.2025, impugned herein, passed by the National Faceless Appeal Center (NFAC)/ Ld. Commissioner of Income Tax (Appeals) (in short Ld. Commissioner) u/s 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y. 2012-13.
The parties have submitted that the Assessment Order 2. dt. 20/12/2019 u/s 143 (3) r.w.s.147 of the act, on the basis of which penalty to the tune of Rs. 4,36,323/- has been levied vide order dt. 25.06.2021 u/s 271 (1)(C) of the M/s. Capco Finance & Investment Private Ltd. (Stuck off) act by the AO, has already been quashed by the Hon’ble Co- ordinate Bench of the Tribunal vide order dt. 20/02/2025 passed in ITA No. 44/M/2025.
As a foundation of the penalty levied, has already been collapsed and thus the penalty levied, will also face the same consequences, thus, the penalty levied is deleted.
Resultantly, the appeal filed by the Assessee is allowed. Order pronounced in the open court on 02.12.2025.