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Income Tax Appellate Tribunal, DIVISION BENCH’B’, CHANDIGARH
Before: SHRI N.K. SAINI & SHRI SANJAY GARGShri Mukesh Mittal
PER N.K. SAINI, VICE PRESIDENT :
This is an appeal by the Assessee against the order dt. 30/06/2018 of Ld. CIT(A)-3, Gurgaon.
The only grievance of the assessee in the appeal relating to the sustaining of penalty amounting to Rs. 34,964/- levied by the Assessing Officer under section 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as ‘Act’).
During the course of hearing the Ld. Counsel for the assessee at the very outset stated that the addition on the basis of which impugned penalty was levied by the Assessing Officer had been deleted by this Bench of the Tribunal in ITA No. 38/Chd/2018 for the A.Y. 2006-07 vide order dt. 05/11/2018, copy of the said order was furnished which is placed on record.
In his rival submissions, the Ld. Sr. DR although supported the orders of the authorities below but could not controvert on the aforesaid contention of the Ld. Counsel for the assessee.
We have considered the rival submissions of both the parties and carefully gone through the material available on record, in the present case it is an admitted fact that the addition on the basis of which penalty was levied by the
Assessing Officer had been deleted by the ITAT vide aforesaid referred to order dt. 05/11/2018. On a similar issue the Hon’ble Supreme Court in the case of K.C. Builders and Another Vs. ACIT (2004) 265 ITR 562 held as under: “ Where the additions made in the assessment order on the basis of which penalty for concealment is levied, are deleted, there remains no basis at all for levying penalty for concealment and, therefore, in such a case no penalty can survive and the penalty is liable to be cancelled. Ordinarily, penalty cannot stand if the assessment itself is set aside.”
5.1 In the present case also since the addition on the basis of which the penalty was levied is not in existence therefore the impugned penalty under section 271(1)(c) of the Act levied by the Assessing Officer and sustained by the Ld. CIT(A) is deleted. 6. In the result, the appeal of the Assessee is allowed.
(Order pronounced in the open Court on 23/01/2019)
Sd/- Sd/- (SANJAY GARG) (N.K. SAINI) JUDICIAL MEMBER VICE PRESIDENT Dated : 23/01/2019 AG Copy to: 1.The Appellant, 2. The Respondent, 3. The CIT(A), 4. The CIT, 5. The DR