PRINCIPAL COMMISSIONER OF INCOME TAX 5 vs. KALYANBHAI K. PATEL

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TAXAP/889/2018HC GujaratGJHC24011206201821 August 2018Bench: HONOURABLE MR. JUSTICE AKIL KURESHI,HONOURABLE MR. JUSTICE B.N. KARIA2 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that the issue pertains to penalties levied under Section 158BFA of the Act, which the Tribunal had deleted on the ground that the quantum additions had been deleted. The Court noted that in a separate appeal filed by the Revenue (Tax Appeal No. 723 of 2018), the Revenue's grounds against the quantum additions were not entertained. Consequently, since the basis for the penalty (the quantum additions) was not sustained, the deletion of the penalty by the Tribunal was upheld. The appeal filed by the Revenue was dismissed.

What were the facts?

The Revenue is in appeal against a judgment of the Income Tax Appellate Tribunal (ITAT) dated May 25, 2017. The appeal challenges the ITAT's deletion of penalties levied under Section 158BFA(2) of the Income Tax Act. The penalties were imposed on additions made on account of unexplained investments in land at Nikol (Rs. 854,704) and Odhav (Rs. 22,74,000 and Rs. 18,69,756). The ITAT had deleted these penalties on the ground that the underlying quantum additions themselves had been deleted. The High Court noted that in a separate appeal (Tax Appeal No. 723 of 2018), the Revenue's grounds against the quantum additions were not entertained.

What were the issues?

1. Whether, on the facts and in law, the Appellate Tribunal was correct in deleting the penalty levied under Section 158BFA(2) of the Act on the addition of Rs. 854,704 made on unexplained investment in Nikol land and Rs. 22,74,000 made on unexplained investment in the land at Odhav? 2. Whether, on the facts and in law, the Appellate Tribunal was correct in deleting the penalty levied under Section 158BFA(2) of the Act on the addition of Rs. 18,69,756 made on unexplained investment in Odhav land? Assessee's Contentions: Not recorded in the judgment. Revenue's Contentions: The Revenue is in appeal against the ITAT's deletion of penalties. The ITAT deleted the penalties because the quantum additions on which they were based had been deleted. The Revenue's grounds against the quantum additions were not entertained in a separate appeal.

Which sections of the Income-tax Act were involved?

Section 158BFA(2)

AI-generated summary — verify with the full judgment below

C/TAXAP/889/2018 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 889 of 2018 ========================================================== PRINCIPAL COMMISSIONER OF INCOME TAX 5 Versus KALYANBHAI K. PATEL ========================================================== Appearance: MRS MAUNA M BHATT(174) for the PETITIONER(s) No. 1 for the RESPONDENT(s) No. 1 ========================================================== CORAM: HONOURABLE MR.JUSTICE AKIL KURESHI and HONOURABLE MR.JUSTICE B.N. KARIA

Date : 21/08/2018

ORAL ORDER (PER : HONOURABLE MR.JUSTICE AKIL KURESHI) 1. The Revenue is in appeal against the judgment of the Income Tax Appellate Tribunal dated 25.05.2017. Though several questions are framed, we are informed that Questions­A to D in the Tax Appeal do not arise for consideration in this appeal.   We may therefore focus on the surviving questions which are germane of this appeal.  These questions are as under: “[E] Whether on facts the case and in law, the   Appellate   Tribunal   is   correct   in deleting the penalty levied u/s. 158BFA(2) of the Act on the addition of Rs.854,704/­ made on unexplained investment in Nikol land and   Rs.22,74,000/­   made   on   unexplained investment in the land at Odhav? Page 1 of 2

C/TAXAP/889/2018 ORDER [F] Whether on facts the case and in law, the   Appellate   Tribunal   is   correct   in deleting the penalty levied u/s. 158BFA(2) of the Act on the addition of Rs.18,69,756/­ made   on   unexplained   investment   in   Odhav land?” 2. Issue pertains to penalty levied under section 158BFA of the Act which the Tribunal deleted on the ground that the quantum additions have been deleted. In a separate appeal filed by the Revenue being Tax Appeal   No.723   of   2018,   we   have   not   entertained Revenue's grounds against the quantum additions. 3. In the result, this Tax Appeal is dismissed.

(AKIL KURESHI, J) (B.N. KARIA, J) ANKIT SHAH Page 2 of 2

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