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Facts
The assessee filed a return of income, and the case was selected for scrutiny. The assessment was completed under section 144 of the Act, and a penalty was initiated under section 272A(1)(d) for non-compliance. The assessee's appeal against the penalty order was dismissed by the CIT(A).
Held
The Tribunal noted that the assessment was completed under section 144 and penalty proceedings were initiated under section 272A(1)(d). Since the basis for the penalty initiation was remitted to the AO for fresh consideration concerning the quantum addition, the penalty appeal was also to be remitted for a fresh consideration.
Key Issues
Whether the penalty appeal should be remitted to the AO for fresh consideration when the quantum assessment, forming the basis for the penalty, is remitted.
Sections Cited
143(2), 144, 69A, 115BBE, 271AAC(1), 272A(1)(d), 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “B” BENCH : BANGALORE
Before: SHRI.LAXMI PRASAD SAHU & SHRI.KESHAV DUBEY
O R D E R Per Laxmi Prasad Sahu, Accountant Member :
This appeal is filed by the assessee against the Order passed by the NFAC, CIT(A) vide DIN and Order No.ITBA/NFAC/S/250/2025- 26/1078231080(1) dated 07.07.2025.
Briefly stated the facts of the case are that assessee filed return of income on 02.08.2017 declaring income of Rs.3,29,860/-. Case was selected for scrutiny and notice under section 143(2) of the Act was issued to the assessee and other statutory notices were issued for completing assessment under section 144 of the Act. From the information available with the Department, assessee had maintained 2 bank accounts (i) savings bank account No.593101203023 in Canara Bank, Vishweshwarapuram Branch and (ii) Account Nos.47746 and 18293 in Sir M Visvesvaraya Co-operative Bank Page 2 of 4 Ltd. The total cash deposited ofRs.44,08,927/- was added as income under section 69A of the Act and section 115BBE of the Act was also applied and assessment was completed ex-parte. Penalty proceedings were also initiated under sections 271AAC(1) and 272A(1)(d) of the Act.
Aggrieved from the above Order, assessee filed appeal before the learned CIT(A) against penalty Order on 26.11.2021. The learned CIT(A) dismissed appeal of the assessee.
Aggrieved from the above Order, assessee is in appeal before the Tribunal. The learned Counsel submitted that assessee filed appeal against 144 Order before learned CIT(A) on 19.02.2020 and the learned CIT(A) set aside the matter to the AO for a fresh consideration observing as under:
Aggrieved he submitted that once quantum proceedings have been set aside to the AO the penalty Order should also go back to AO for fresh consideration.
Learned DR relied on the Order of AO and lower authorities.
Considering the submissions of the assessee, we noted that assessment was completed under section 144 of the Act and penalty proceedings was also initiated under section 272A(1)(d) of the Act on 17.11.2021 of Rs.10,000/- and the penalty Order has been confirmed by CIT(A). Assessee had also filed appeal against 144 Assessment Order before learned CIT(A) and the learned CIT(A) had dismissed penalty appeal as noted supra and directed the AO to Page 4 of 4 pass fresh Order on merits of addition. Therefore the very basis for initiation of penalty under section 272A(1)(d) of the Act is remitted to AO, then the penalty appeal should also go to AO for a fresh consideration.
In the result, appeal filed by the assessee is allowed for statistical purposes.