ITO 25(3)(1), MUMBAI vs. SHOBHA CHIDMABARAM, MUMBAI

PDF · subscribers
ITA 2497/MUM/2021Status: DisposedITAT Mumbai01 June 2022AY 2010-114 pages

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

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the CIT(A)'s decision to reduce the penalty to 10% of the original amount, aligning it with the reduced quantum addition confirmed by the ITAT. The AO's grounds of appeal were found to be based on a misreading of the CIT(A)'s order.

What were the facts?

The Assessing Officer (AO) levied a penalty under Section 271(1)(c) on the assessee for bogus purchases. The quantum addition for these purchases was later reduced by the ITAT to 10%. The CIT(A) then reduced the penalty to 10% of the original penalty amount.

What were the issues?

Whether the penalty under Section 271(1)(c) should be reduced in proportion to the reduced quantum addition confirmed by the ITAT. Whether the CIT(A) erred in reducing the penalty amount.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 69C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “G” BENCH, MUMBAI

For Appellant: Shri Mehul Jain, AR
For Respondent: Shri Hoshang B Irani, DR
Hearing: 23.05.2022Pronounced: 01.06.2022
1.

This appeal is filed by ITO, Ward 23(1), Mumbai (the learned Assessing Officer) against the order passed by National Faceless Centre, [the learned CIT(A)] for Assessment Year 2010-11, wherein the penalty under Section 271(1)(c) of the Act by the order dated 31st March, 2016 of ₹2,84,756/- was reduced to only 10% of the penalty i.e. to ₹28,475/-. The learned Assessing Officer has raised the following three grounds of appeal:-

2. Whether on the facts and in the circumstances of the case and in law, the Ld CIT(A) has erred in deleting the penalty u/s. 271(1)(c) of Rs 2,56,280/- in spite of the penalty was levied in respect of addition of Rs.9,21,532/- made on the basis of information received from Sales Tax Department, Maharashtra with regard to bogus purchase made by the assessee from entry providers without supply of actual goods and sound evidence.

3. Whether on the facts and in the circumstances of the case and in law. the Ld CIT(A) has erred in deleting the penal, u/s. 271(1)(d) of Rs.2,56,280/- imposed n respect of difference between enhanced income over and above the returned income based on evidences which prove that the assessee has debited purchases from parties which did not make actual supply of goods and. thereby, falsified the books accounts.

4. The appellant craves leave to amend or alter or add a new ground which may be necessary.”

2.

The brief fact of the case shows that assessee is an individual running a proprietary business in the name of Sai Plastic Industries of dealing and fixing of PVC doors, windows, etc. The assessee filed her return of income on

3.

Meanwhile, the penalty order was passed under Section 271 of the Act on 31st March, 2016, wherein penalty was levied holding that assessee has furnished inaccurate particulars of income of ₹9,21,532/-. The assessee challenged the penalty order before the learned CIT (A), who confirmed the levy of penalty but restricted to 10% of the penalty levied based on the order of ITAT. Accordingly, the penalty of ₹2,84,756/- was reduced to ₹28,475/-. The Assessing Officer is aggrieved with this order of learned CIT (A).

4.

We have heard the rival contentions and we find that on principle, the learned CIT (A) has upheld the levy of penalty, however, reduced the amount of penalty to 10% only. This was made so, as the quantum addition itself was reduced by ITAT to the extent of 10% only. We do not find any infirmity in the order of the learned CIT (A). Further, looking at the grounds of appeal raised by the learned Assessing Officer it is claimed that CIT (A) has

5.

In the Result, appeal filed by the learned Assessing Officer is dismissed.

Order pronounced in the open court on 01.06.2022.

More judgments on Section 271(1)(c)

All 25,141 judgments and leading authorities on Section 271(1)(c) →

Recent GST High Court judgments

Search GST case law →