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Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI KUL BHARAT & SHRI MANISH BORAD
PER MANISH BORAD, AM.
This appeal of Assessee pertaining to A.Y. 2008-09 is directed
against the order of Ld. Commissioner of Income Tax(Appeals)-II,
Indore (in short ‘CIT(A)’), dated 01.05.2017 which is arising out of
the order u/s 271(1)(c) of the Income Tax Act 1961(hereinafter
called as the ‘Act’) framed on 01.03.2016 by ITO-5(5), Indore.
Mahesh Kumar ITA No.554/Ind/2017 2. The assessee’s sole grievance is against the order of Ld.CIT(A)-
II, Indore confirming the penalty of Rs.39,82,800/- levied by the Ld.
Assessing Officer u/s 271(1)(c ) of the Act on account of
unexplained source of deposit in bank account.
At the outset Ld. Counsel for the assessee submitted that the
impugned penalty of Rs.39,82,800/- was levied by the Ld.
Assessing Officer on the addition for unexplained deposit in bank of
Rs.1,32,76,000/-. He further submitted that the assessee went in
appeal before Hon'ble Tribunal against the quantum of addition and
Hon'ble Tribunal vide order dated 24.5.2017 in I.T..A No.
752/Ind/2014 deleted the quantum addition of Rs.1,32,76,000/-.
He prayed that as the quantum has been deleted, no penalty is
leviable u/s 271(1)(c ) of the Act.
Ld. Departmental Representative failed to controvert the
submission made by the assessee.
We have heard rival contentions and perused the records
placed before us. We find that the addition of unexplained deposit
in bank account at Rs.1,32,76,000/- was made by the Income Tax
Officer Ward 3(3), Indore in the assessment order framed us/ 143(3) 2
Mahesh Kumar ITA No.554/Ind/2017 of the Act dated 31.12.2010 which was followed by the penalty
proceedings u/s 271(1)(c ) and vide order dated 01.03.2016 penalty
@100% of tax sought to be evaded on the addition of
Rs.1,32,76,000/- was levied at Rs.39,82,800/-.
We find that the Co-ordinate Bench in I.T.A.No. 752/Ind/2014
order dated 24.05.2017 while adjudicating the issue of quantum of
addition in the case of assessee deleted the addition of
Rs.1,32,76,000/- made on account of unexplained cash credit on
the basis of circumstantial evidences on record and statement of
Power of Attorney holder recorded by the A.O and holding that the
amount of Rs.1,32,76,000/- is received by the assessee on account
of sale of agriculture land and the same is to be treated as capital
receipt.
In the instant appeal the issue before us limits to penalty
levied u/s 271(1)(c ) of the Act at Rs.39,82,800/- on the quantum of
addition of Rs.1,32,76,000/- on account of unexplained cash credit.
The basis of levying penalty u/s 271(1)(c ) of the Act is on the
addition made in the hands of the assessee. In the instant case,
the very basis of levying penalty i.e. the quantum addition has been
Mahesh Kumar ITA No.554/Ind/2017 deleted by the Co-ordinate Bench therefore penalty u/s 271(1)(c)
has no legs to stand for. In our considered view the impugned
penalty needs to be deleted. We accordingly do so and direct the
Ld. Assessing Officer to delete the penalty of Rs.32,82,800/-.
In the result the appeal of the assessee is allowed.
The order pronounced in the open Court on 12.10.2018.
Sd/- Sd/-
( KUL BHARAT) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER �दनांक /Dated : 12 October, 2018 /Dev
Copy to: The Appellant/Respondent/CIT concerned/CIT(A) concerned/ DR, ITAT, Indore/Guard file. By order Asstt.Registrar,I.T.A.T., Indore