DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 1(1) KOLKATA, KOLKATA vs. RADHESHYAM AGARWALA, KOLKATA

Facts

The revenue challenged the CIT(A)'s deletion of penalties levied under Section 271(1)(c) and Section 270A for assessment years 2016-17 to 2020-21. Penalties were imposed after the assessee filed returns under Section 153C (following a search on his son), which were subsequently accepted by the Assessing Officer without any further additions. The assessee filed cross-objections supporting the CIT(A)'s order.

Held

The Tribunal upheld the CIT(A)'s decision to delete the penalties, reasoning that when returns filed under Section 153C are accepted without any additions, and there is no direct search on the assessee or incriminating material used for additions, no penalty for concealment or inaccurate particulars can be levied. The Tribunal relied on various High Court judgments, including the jurisdictional Kolkata High Court, and dismissed the revenue's appeals and the assessee's infructuous cross-objections.

Key Issues

Whether penalties under Section 271(1)(c) or 270A are leviable when returns filed in response to a Section 153C notice are accepted without additions, especially where no direct search occurred on the assessee.