BHILAI KARMCHARI ADARSH SAKH SAHKARI SAMITI MARYADIT vs. THE PRINCIPAL COMMISSIONER OF INCOME TAX - RAIPUR 1

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WPT/143/2024HC ChhattisgarhCGHC01024853202409 April 2026Bench: HON'BLE SHRI JUSTICE RAKESH MOHAN PANDEY2 pages
AI SummaryRemanded

What did the High Court hold?

The High Court did not decide the merits of the penalty order. Instead, it permitted the petitioner to make a representation to the respondent authorities, enclosing a copy of the order passed in the appeal and the revision. The competent authority was directed to decide the issue concerning the penalty imposed within 45 days from the receipt of the order. The Court did not make any finding on the validity of the penalty or the assessment order, nor did it express any opinion on the arguments presented. The petition was disposed of with directions for a representation and a decision by the authority.

What were the facts?

The petitioner, Bhilai Karmchari Adarsh Sakh Sahkari Samiti Maryadit, filed a writ petition challenging a penalty order under Section 271(1)(c) and a revision order under Section 264 of the Income Tax Act. The petitioner argued that the assessment order, which was the basis for the penalty, had already been set aside by the CIT(Appeals). The revenue contended that a revision was preferred against the penalty, and it was noted that the penalty would be subject to the outcome of the appeal. The revenue suggested the petitioner make a representation to the authorities.

What were the issues?

1. Whether a penalty under Section 271(1)(c) can be imposed when the underlying assessment order has been set aside by the appellate authority? Assessee's Contention: The petitioner argued that since the assessment order was set aside by the CIT(Appeals), the penalty imposed based on that order cannot sustain. The petitioner relied on the principle that a penalty is consequential to a valid assessment order. Revenue's Contention: The revenue stated that a revision was filed against the penalty order, and it was observed that the penalty's fate was contingent on the appeal's outcome. The revenue suggested that the petitioner should make a representation to the concerned authorities.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 264

AI-generated summary — verify with the full judgment below

2026:CGHC:16653

NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WPT No. 143 of 2024 * - Bhilai Karmchari Adarsh Sakh Sahkari Samiti Maryadit Sector-2, Bhilai, Through Its President - Jaigovind, S/o Late Phayaram Yadav, Aged About 56 Years, Resident Of Qr. No. 3A, Street-24, Sector-2, Bhilai, District Durg (C.G.)

... Petitioner Versus 1 - The Principal Commissioner Of Income Tax - Raipur 1 Central Revenue Building Civil Lines, Raipur (C.G.) 2 - Assessment Unit, Income Tax Department, National Faceless Assessment Centre, Delhi

... Respondents For Petitioner : Mr. Vijay Shanker Mishra, Advocate For Respondents : Mr. Ajay Kumrani, Advocate holding the brief of Mr. Amit Chaudhari, Advocate Hon’ble Shri Justice Rakesh Mohan Pandey Order on Board 10/04/2026 1. The petitioner has filed this petition seeking the following relief(s):- “10.1 Calling the records of the case. 10.2 Quashing the penalty order u/s. 271 (1) (C) issued on by the respondent no. 2 (ANNEXURE- P/4) and revision order passed u/s. 264 of the I.T. Act on (ANNEXURE-P/8) passed by the respondent No. 1. 10.3 Any other relief, which this Hon’ble Court deems fit may also be granted.” Digitally signed by RAMESH KUMAR VATTI Date: 2026.04.13 11:13:48 +0530

2 2. Mr. Vijay Shanker Mishra, learned counsel appearing for the petitioner would submit that assessment order was subject of challenge in CIT appeal preferred before CIT and said appeal has been allowed and order of assessment has already been set aside. He would contend that as the order of assessment has already been set aside, penalty cannot be imposed. 3. Mr. Ajay Kumrani, learned counsel appearing for the respondents would submit that a revision was preferred against the penalty, wherein it was observed that the penalty would be subject to outcome of appeal. He would submit that as appeal has already been allowed, the petitioner should approach the respondent authorities making a representation. 4. Heard learned counsel for the parties. 5. Taking into consideration the above discussed facts, the petitioner is permitted to make a representation alongwith copy order passed in appeal and revision before the respondent authorities and the competent authority is directed to take decision with regard to penalty imposed, within a period of 45 days from the date of receipt of copy of this order. 6. With the aforesaid observation(s) / direction(s), the petition is disposed of. Sd/-

(Rakesh Mohan Pandey)

Judge vatti

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