MAHAGUN (INDIA) PVT. LTD.,DELHI vs. ACIT,CC-13, NEW DELHI , NEW DELHI

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ITA 75/DEL/2026Status: DisposedITAT Delhi22 May 2026AY 2013-143 pages

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

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the issue regarding deemed rental income was debatable at the relevant time. Following the Delhi High Court's decision in PCIT Vs. Ansal Properties and Infrastructure Ltd, the Tribunal deleted the penalty.

What were the facts?

The assessee appealed against a penalty levied under Section 271(1)(c) of the Income Tax Act, 1961. The penalty was related to an addition made on account of deemed rental income.

What were the issues?

Whether penalty under Section 271(1)(c) is leviable when the addition made is on a debatable issue regarding deemed rental income.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, DELHI

Before: SHRI S RIFAUR RAHMAN & SHRI ANUBHAV SHARMA

For Appellant: Ms. Suman Jain, CA
Hearing: 18.05.2026Pronounced: 22.05.2026

P a g e | 1 ITA No. 75/Del/2026 Mahagun (India) Pvt. Ltd. (AY; 2013-14) IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, DELHI

BEFORE SHRI S RIFAUR RAHMAN, ACCOUNTANT MEMBER & SHRI ANUBHAV SHARMA, JUDICIAL MEMBER ITA No.75/Del/2026 (Assessment Year: 2013-14)

Mahagun (India) Pvt. Ltd. Vs. ACIT, CC-13 3rd Floor, ARA Central C-227, Vivek Vihar, Delhi – 110095 Jhandewalan, New Delhi – 110056 स्थायीलेखासं./जीआइआरसं./PAN/GIR No: AAACM6572A Appellant .. Respondent

Appellant by : Ms. Suman Jain, CA Respondent by : Sh. Rajesh Kumar Dhanesta, Sr. DR

Date of Hearing 18.05.2026 Date of Pronouncement 22.05.2026 O R D E R PER ANUBHAV SHARMA, JM:

This appeal is preferred by the assessee against the order dated 16.08.2025 of the Ld. Commissioner of Income Tax (Appeals)-26 Delhi (hereinafter referred to as the First Appellate Authority or ‘the ld. FAA’ for short) DIN & Order No: ITBA/APL/S/250/2025-26/1079660369(1) arising

P a g e | 2 ITA No. 75/Del/2026 Mahagun (India) Pvt. Ltd. (AY; 2013-14) out of the assessment order dated 19.03.2025 u/s 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) passed by DCIT, Central Circle - 13, Delhi for AY: 2013-14.

2.

On hearing both sides we find that the issue involved is the levy of penalty on account of addition made on deemed rental income and ld. Counsel has relied the decision of Hon’ble Delhi High Court in the case of PCIT Vs. Ansal Properties and Infrastructure Ltd, reported as (2023) 152 taxmann.com 49/(2024) 460 ITR 341 (Delhi HC) wherein Hon’ble High Court has held that the issue involved was debatable at that point in time, thus, levy of penalty was deleted. The proposition of law squarely applies to the facts of case of assessee, accordingly, we allow the appeal and penalty levied is deleted.

Order pronounced in the open court on 22.05.2026

Sd/- Sd/- (S Rifaur Rahman) (Anubhav Sharma) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated 22.05.2026 Rohit, Sr. PS

P a g e | 3 ITA No. 75/Del/2026 Mahagun (India) Pvt. Ltd. (AY; 2013-14) Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI

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