DEPUTY COMMISSIONER OF INCOME TAX , MADURAI vs. RAMCO CEMENTS LIMITED , RAJAPALAYAM

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ITA 748/CHNY/2025Status: DisposedITAT Chennai10 June 2025AY 2016-17Bench: SHRI MANU KUMAR GIRI (Judicial Member), SHRI HON'BLE S.R. RAGHUNATHA (Accountant Member)1 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 held that the penalty does not survive when the underlying disallowance has been deleted by a co-ordinate bench in quantum proceedings, as it is a judicially settled view. Therefore, the CIT(A) had rightly deleted the penalty.

What were the facts?

The AO imposed a penalty of Rs.11,60,04,363/- for furnishing inaccurate particulars of income. A related disallowance of Rs.33,51,95,223/- in quantum proceedings was deleted by a co-ordinate bench of the Tribunal. The CIT(A) deleted the penalty based on this deletion.

What were the issues?

Whether the penalty imposed for furnishing inaccurate particulars of income survives when the related disallowance in quantum proceedings has been deleted by the Tribunal.

Which sections of the Income-tax Act were involved?

Section 147,Section 148,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘B’ BENCH: CHENNAI

Before: HON’BLE SHRI MANU KUMAR GIRI & SHRI HON’BLE S.R. RAGHUNATHA

Hearing: 04.06.2025Pronounced: 10.06.2025

आदेश / O R D E R

PER MANU KUMAR GIRI (Judicial Member): This appeal filed by the Revenue is directed against the order of the Ld. Commissioner of Income Tax (Appeals) NFAC, Delhi [CIT(A)] dated 21.01.2025 for Assessment Year 2016-17.

2.

Brief facts of the case are that the AO vide impugned penalty order for AY 2016-17 imposed a penalty amounting to income. In quantum proceedings, the claim of railway siding expenditure of Rs.33,51,95,223/- were disallowed in the assessment order.

3.

Aggrieved, assessee filed appeal before the Ld. CIT(A)

1.

challenging the imposition of penalty. The Ld. CIT(A) has deleted the penalty imposed by the AO, noting the result of the quantum proceedings, where the co-ordinate Bench of the Tribunal in IT(TP)A No.46/CHNY/2021 (AY 2016-17) has deleted disallowance relating to the claim of railway siding expenditure of Rs.33,51,95,223/- and allowed the appeal of the assessee.

Aggrieved, revenue is in further appeal before us.

4.

Before us, the Ld. DR, Mr. M.K.Biju, CIT has contended that against the Tribunal order in the quantum proceedings, the Revenue has filed appeal before the Hon’ble High Court hence the proceedings has not been reached finality.

5.

Per contra, the Ld. counsel submitted that the Co-ordinate Bench of the Tribunal in IT(TP)A No.46/CHNY/2021 (AY 2016-17) has Ramco Cement Ltd. :- 3 -: deleted disallowance relating to the claim of railway siding expenditure of Rs.33,51,95,223/- and allowed the appeal of the assessee. He further contended that there is no stay by the Hon’ble High Court against the order of Tribunal passed in quantum proceedings.

6.

We have heard the both parties. In the aforesaid facts and circumstances of the case, we are of the considered view that the Ld. CIT(A) has rightly deleted the penalty. It is judicially settled view that when the disallowance has been deleted by the Tribunal in quantum proceeding, the penalty does not survive.

7.

In the result, the appeal filed by the Revenue is dismissed. Order pronounced on 10th day of June, 2025 at Chennai.

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