MAHALAXMI AUTOMOBILES,THANE vs. INCOME TAX OFFICER WARD 4(1), THANE, THANE

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ITA 2083/MUM/2026Status: DisposedITAT Mumbai13 August 2026AY 2019-204 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the penalty appeal should also be restored to the CIT(A) for fresh decision. The CIT(A) is to decide the penalty appeal after considering the outcome of the quantum appeal.

What were the facts?

The assessee filed an appeal against a penalty order under Section 271AAC(1). An appeal against the quantum addition was previously set aside by the ITAT and restored to the CIT(A) for fresh adjudication.

What were the issues?

Whether the penalty proceedings should be kept in abeyance pending the decision on the quantum appeal. The proper adjudication of the penalty appeal in light of the pending quantum appeal.

Which sections of the Income-tax Act were involved?

Section 271AAC(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCHES, MUMBAI

Before: SANDEEP GOSAIN & BIJAYANANDA PRUSETH

Pronounced: 13.08.2026

PER SANDEEP GOSAIN, JUDICIAL MEMBER:

This appeal is filed by the Assessee against the order of Ld. NATIONAL FACELESS APPEAL CENTRE (NFAC), DELHI vide DIN: ITBA/NFAC/S/250/2025-26/1083584312(1) dated 11-Dec-2025 for the Assessment Year 2019-20. The assessee has raised the following grounds of appeal:

1.

The Ld. AO erred in levying (CIT(A) earned confirming penalty of Rs. 58,35,927/- u/s 271AAC (1).

2.

The Ld. CIT-A erred is not appreciating the fact that the appeal against the quantum order is pending before CIT-A, so o he he ought to have kept the penalty proceedings in abeyance till the quantum appeal is decided by CIT-A.

3.

The appellant craves its right to add to or alter the Grounds of Appeal at any time before or during hearing of the case.

2.

From the record, we noticed that the present appeal has been filed against the order upholding the imposition of penalty under Section 271AAC(1) of the Income-tax Act, 1961.

3.

In this regard, we have heard the learned counsel for the parties and perused the material placed on record. From the records, we find that an appeal against the quantum addition was filed before the ITAT and the Coordinate Bench of the ITAT, vide its order dated 28.03.2025 in ITA No. 6743/Mum/2024, set aside the order of the learned CIT(A) and directed the learned CIT(A) to hear the appeal on merits.

4.

The said appeal is presently pending before the learned CIT(A).

5.

Therefore, considering these facts, the present appeal, which is against the imposition of penalty, is also restored back to the file of the learned CIT(A) for deciding the same afresh in accordance with law, in view of the fresh findings to be recorded by the learned CIT(A) in the quantum appeal.

6.

Needless to say, the learned CIT(A) shall afford reasonable opportunity of being heard to the assessee and decide the penalty appeal in accordance with law after considering the outcome and findings in the quantum appeal.

7.

In the result, the appeal is allowed for statistical purposes.

Order pronounced in the open court on 13.08.2026.

Sd/- Sd/- BIJAYANANDA PRUSETH SANDEEP GOSAIN ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai Dated: 13.08.2026 RY-SrPS Copy to: MAHALAXMI AUTOMOBILES, SURVEY NO 13 14/3 NEXT 70 HOTEL 1 SAGAR,BHIVANDI KAMAN ROAD VASAI, THANE-401202, MAHARASHTRA INCOME TAX OFFICER WARD 4(1), THANE, ASHAR IT PARK, 6TH FLOOR, ROAD NO 2 16Z,WAGLE INDUSTRIAL ESTATE, THANE (WEST),, THANE-400604, MAHARASHTRA 3 THE PCIT / CIT, 4 THE D.R., ITAT, MUMBAI BENCH 5 GUARD FILE

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