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Income Tax Appellate Tribunal, “C” BENCH, MUMBAI
Before: SHRI VIKAS AWASTHY, HONBLE & SHRI S. RIFAUR RAHMAN, HONBLEShri Yogesh Joijode Shri R.A. Dhyani
O R D E R PER S. RIFAUR RAHMAN (AM)
This appeal is filed by the revenue against order of the Learned Commissioner of Income Tax (Appeals)–47, Mumbai [hereinafter in short “Ld.CIT(A)”] dated 04.11.2020 for the A.Y. 2008-09 in partly sustaining the penalty levied u/s. 271(1)(c) of the Act.
Revenue has raised following grounds in its appeal: -
(A.Y: 2008-09) Priyanka Chopra “On the issue of levying penalty of ₹.83,43,000/- 1.1 Whether on the facts and in the circumstances of the case, the Ld. CIT(A) has erred in directing the AO to restrict the penalty to 100% instead of 300%? 1.2 Whether on the facts and in the circumstances of the case, the order of CIT(A) was perverse on facts while restricting the penalty imposed by Assessing Officer at the rate of 300% u/s 271(1)(c) of the Act to 100% of evaded tax. 1.3 Whether on the facts and in law in the circumstances of the case, the Order of CIT(A) was fallacious in so far that there was no rebuttal to the reasons recorded by Assessing Officer for levying 300% of penalty u/s 271(1)C) of evaded taxes and nowhere any new arguments or substantiating evidence filed by assessee to controvert the findings of the Assessing Officer? 1.4 Whether on the facts and in law in the circumstances of the case, the CIT(A) erred in deleting penalty u/s 271(1)(c) on addition of Rs. 50 lakhs which was confirmed by Ld.ITAT in quantum appeal?”
At the time of hearing, Ld. AR submitted that Department is in appeal against the reduction of penalty from 300% to 100% by Ld.CIT(A) and submitted that the assessment year under consideration has two issues for consideration: - a. Addition of ₹.40 lacs being unacounted/undisclosed income in the form of Gifts from LVMH Watch and Jewellery India Pvt. Ltd.,
b. Addition of ₹.50 Lacs for purchase of studio Aesthetique.
In this regard he submitted that assessee had already applied for Direct Tax Vivad Se Vishwas (DTVSV) Act, 2020 for the A.Y. 2008-09 against the quantum additions which were pending before Hon’ble
(A.Y: 2008-09) Priyanka Chopra Bombay High Court. It is submitted that the said High Court appeal has been withdrawn vide order dated 23.06.2021 in compliance with the provisions of DTVSV, he brought to our notice the Hon'ble High Court Order. Ld. AR further submitted that as per Section 3 of DTVSV Act, 2020, "where tax arrears includes tax, interest or penalty determined in any assessment on the basis of search under section 132 or section 132A of the Income Tax Act" then the amount payable under this act is "aggregate of the amount of disputed tax". Further the term disputed tax is separately defined in section 2 of the DTVSV Act, 2020. He brought to our notice section 2 and section 3 of DTVSV Act, 2020. He submitted that as per the DTVSV Act, 2020 where an appeal in relation to quantum additions is pending before any forum as on 31.012020, then there is immunity from penalty and interest, if the assessee pays the disputed tax within the specified period. Further he brought to our notice various forms of Direct Tax Vivad se Vishwas Act, 2020, which assessee has filed and received from the Department (i.e., Forms 1, 2, 3, 4 & 5). Accordingly, he prayed that penalty order may be deleted considering the fact that assessee has applied for DTVSV scheme to settle the quantum additions.
On the other hand, Ld. DR fairly accepted the above facts on record.
(A.Y: 2008-09) Priyanka Chopra 6. Considered the rival submissions and material placed on record, we observe that assessee has preferred to settle the issue of quantum addition under DTVSV scheme and accordingly, it is brought to our knowledge that the assessee has paid the due tax under the DTVSV Scheme, the assessee has filed Form 4 & 5 before us. Considering the fact that once the dispute is settled under the DTVSV and as per the provisions of DTVSV 2020, no penalty can be levied or interest on the disputed claim once the issue is resolved under this scheme. Accordingly, the penalty order passed by the Assessing Officer as well as the appeal filed by the revenue in relation to the reduction of penalty from 300% to 100% by the Ld.CIT(A) is accordingly, becomes infructuous. Accordingly, the appeal filed by the Revenue is dismissed.
In the result, appeal of the revenue is dismissed.
Order pronounced in the open court on 25th May, 2022.