LAUDA SAMABAY KRISHI UNNAYAN SAMITY LTD.,,PURBA MEDINIPUR vs. ACIT, CIRCLE 27(1),, HALDIA

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ITA 140/KOL/2026Status: DisposedITAT Kolkata17 June 2026AY 2019-20204 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that once the addition is deleted by the revisionary authority, the Assessing Officer cannot pass a penalty order. Therefore, the penalty order was illegal and without basis.

What were the facts?

The Assessing Officer made an addition under Section 69A, which was later deleted by the Principal Commissioner of Income Tax under Section 264. Despite the deletion, a penalty under Section 271AAC was imposed. The CIT(A) dismissed the assessee's appeal against this penalty.

What were the issues?

Whether a penalty under Section 271AAC can be levied when the original addition has been deleted by the revisional authority under Section 264.

Which sections of the Income-tax Act were involved?

Section 69A,Section 115BBE,Section 264,Section 271AAC

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH,

For Appellant: Shri Soumitra Choudhary, AR
For Respondent: Shri Soumitra Ghosh, Add. CIT, Sr. DR
Hearing: 15.06.2026Pronounced: 17.06.2026

IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, KOLKATA SHRI YOGESH KUMAR U.S., JUDICIAL MEMBER AND SHRI RAKESH MISHRA, ACCOUNTANT MEMBER

ITA No.140/KOL/2026 Assessment Year: 2019-20

Lauda Samabay Krishi Unnayan Vs. ACIT, Circle-27(1), Haldia Samity Limited Lauda banamalichatta Marishda, Dist-Purba Medinipur West Bengal-721449 [PAN: AABTL0348P] APPELLANT RESPONDENT

Appellant by : Shri Soumitra Choudhary, AR Respondent by : Shri Soumitra Ghosh, Add. CIT, Sr. DR

Date of hearing : 15.06.2026 Date of Pronouncement : 17.06.2026 O R D E R PER YOGESH KUMAR U.S., JUDICIAL MEMBER This Appeal is filed by the Assessee against the order of the NFAC, Delhi (Appeal) [“the Ld. CIT(A)”, for short], dated 14.11.2025passed u/s 250 of the Income Tax Act, 1961 (“the Act”, for short) for the assessment year 2019-20.

2.

The Brief facts of the case as stated in the order of the CIT(A) are as under: -

ITA No.140/KOL/2026 Lauda Samabay Krishi Unnayan Samity Limited ; A.Y: 2019-20 “1. The Appellant is a registered Co-Operative Society acting as a Primary Agricultural Credit Society (i.e.. PACS) engaged in the business of banking as well as providing credit facilities to its members and also engaged in the purchase of items intended for agriculture and supplying them to its members. 2. Learned Assessing Officer of National Faceless Assessment Centre (i.e., Ld. AO of NeAC in short) has passed the assessment order u/s 147 r.w.s. 144B on 19.03.2024 for the Assessment Year 2019-20 making addition u/s 69A of the I.T. Act, 1961 assessing the total income at Rs. 7,95,66,456/- raising tax demand of Rs. 12,90,98,581/- invoking provisions of section 115BBE of the Act. 3. The Appellant preferred revision petition before the Learned Jurisdictional PCIT-9. Kolkata on 18.04.2024. Ld. PCIT-9, Kolkata has graciously disposed off the petition u/s 264 in favour of the appellant on 28.05.2024 and the entire addition was deleted. 4. Following the principle of merger, the Order u/s 147 dated 19.03.2024 for the assessment year 2019-20 has been merged with the Order u/s 264 of the Act on 28.05.2024 and therefore no addition u/s 69A was sustained for being taxable u/s 115BBE of the Act and consequent penalty thereupon leviable u/s 271AAC of the Act was thus become infructuous as well as ex-facie null. 5. Two Orders u/s 264 of the Act for the assessment years 2018-19 and 2019-20 had been passed both on 28.05.2024. Both the orders were available as well visible in the ITBA portal. The appellant has brought the information of existence of order u/s 264favouring the Assessee to the knowledge of the Ld. AO of NeAC during penalty proceeding but inadvertently made the mistake of providing the Order u/s 264 relating to the Assessment Year 2018-19 in place of Order for AY 2019-20. Ld. AO of NeAC acting mechanically did not bother to verify from the ITBA portal to see whether any order u/s 264 for the AY: 2019-20 was available or not and also ignoring the effect given consequent upon the Order u/s 264 by the Ld. JAO deleting the entire addition u/s 69A of the Act and imposed the penalty u/s 271AAC of the Act on the appellant.” 3. Aggrieved by the order of the penalty passed u/s 271AAC(1) of the Act, Assessee preferred an Appeal before the Ld. CIT(A). However, the Ld. CIT(A) vide its order dated 14.11.2025, dismissed the Appeal filed by the Assessee. As against the order of the Ld. CIT(A) dated

ITA No.140/KOL/2026 Lauda Samabay Krishi Unnayan Samity Limited ; A.Y: 2019-20 14.11.2025, Assessee preferred an Appeal before the captioned Appeal.

4.

Learned Counsel for the Assessee submitted that after passing of the Assessment Order u/s 147 of the Act on 19.03.2024, a Revision Order u/s 264 of the Act came to be passed on 28.05.2024 wherein the addition of Rs.7,95,66,456/- made by the Assessing Officer u/s 147 of the Act has been deleted. Thereafter, an order giving effect has also been passed u/s 264 of the Act by assessing the income of the Assessee as NIL on 19.06.2024. The Learned Counsel for the Assessee further submitted that though there is no addition subsists against the Assessee, the penalty proceedings has been initiated and order of penalty came to be passed on 27.09.2024, which has been erroneously confirmed by the Ld. CIT(A) on 14.11.2025 vide order impugned. Thus, submitted that Appeal of the Assessee is allowed.

5.

Per Contra, the Ld. DR relied on the orders of the Lower Authorities sought for dismissal of the Appeal.

6.

We have heard the parties and perused the material on record. In the present case, an Assessment Order came to be passed u/s 147 of the Act on 19.03.2024 by making an addition of Rs.7,95,66,456/- u/s 69A of the Act. Thereafter, an Order u/s 264 of the Act came to be passed on 28.05.2024 by deleting the said addition. The said order

ITA No.140/KOL/2026 Lauda Samabay Krishi Unnayan Samity Limited ; A.Y: 2019-20 passed u/s 264 of the Act has been given effect by the Assessing Officer on 19.06.2024 by assessing the income of the Assessee as NIL. Even after deleting the addition by way of Revision Order u/s 264 of the Act, the impugned penalty order has been passed u/s 271AAC(1) of the Act. In our considered opinion, the said order of penalty not only illegal but also without any basis. Once the addition is deleted, the Assessing Officer cannot pass the order of penalty order u/s 271AAC(1) of the Act. Accordingly, the order impugned is hereby set aside.

7.

In the result, Appeal of the Assessee is allowed.

Order pronounced on 17.06.2026. Sd/- Sd/- (RAKESH MISHRA) (YOGESH KUMAR U.S.) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 17.06.2026 DP, PS Copy of the order forwarded to: 1. Appellant 2. Respondent 3. Pr. CIT 4. CIT(A) 5. CIT(DR) //TRUE COPY//

ASSISTANT REGISTRAR KOLKATA BENCHES, KOLKATA

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