ESSEL MINING & INDUSTRIES LTD,MUMBAI vs. DY.COMM OF INCOME TAX CENTRAL CIRCLE-1(40, MUMBAI

Shri Yogesh Thar appearing on behalf of the assessee submitted that the addition on account of suppressed production was made in assessment order passed u/s 153C of the Act for the respective Assessment Years. In respect of said addition penalty proceedings u/s. 271(1)(c) of the Act were also initiated. The Assessing Officer vide separate orders of even date i.e. 28/03/2019 levied penalty of Rs.6,81,18,520/- for the Assessment Year 2009-10 and penalty of Rs.7,66,13,980/- in the Assessment Year 2010-11. The ld. Authorized Representative for the assessee pointed that the additions made in assessment proceedings were deleted by the Tribunal in for Assessment Year 2010-11 and ITA No.1023/Mum/2018 for Assessment Year 2009-10 vide common order dated 15/11/2022.

Shri Ashish Heliwal representing the Department fairly admitted that the additions made in the assessment order on which penalty u/s 271(1)(c) of the Act was levied has been deleted by the Tribunal.

Both sides heard. Both sides are unanimous in stating that the addition on which penalty u/s. 271(1)(c) of the Act was levied has been deleted by the Tribunal vide order dated 15/11/2022(supra) . Once substratum for levy of penalty has eroded, the penalty proceedings does not survive. In the light of undisputed facts, the impugned order confirming penalty u/s. 271(1)(c) of the Act for Assessment Year 2009-10 and 2010-11 is quashed and the appeals of the assessee are allowed.

In the result, appeals by the assessee for Assessment Year 2009-10 and 2010- 11, respectively are allowed. Order pronounced in the open court on Monday the 28th day of November, 2022.