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Facts
The assessee filed an appeal against the order of the Ld. CIT(A) / NFAC confirming a penalty of Rs.38,24,86,228/- levied by the Assessing Officer under Section 270A for assessment year 2018-19. The penalty was imposed on account of additions related to differences in capital account and sundry creditors. A delay of 49 days in filing the appeal was condoned by the Tribunal.
Held
The Tribunal found that in separate quantum proceedings for the same assessment year, the additions related to capital account and sundry creditors, which formed the basis for the Section 270A penalty, had already been deleted. Therefore, the Tribunal held that the penalty could not survive and directed the Assessing Officer to cancel it, allowing the assessee's appeal.
Key Issues
Whether a penalty levied under Section 270A of the Income Tax Act, 1961, can be sustained when the underlying quantum additions have been deleted by the Tribunal in separate proceedings.
Sections Cited
270A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCH “B”, PUNE
Before: SHRI R. K. PANDA & SHRI VINAY BHAMORE
This appeal filed by the assessee is directed against the order dated 09.09.2024 of the Ld. CIT(A) / NFAC, Delhi relating to assessment year 2018-19.
There is a delay of 49 days in filing of this appeal before the Tribunal for which the assessee has filed a condonation application along with an affidavit explaining the reasons for such delay. After considering the contents of the condonation application filed along with the affidavit and after hearing the Ld. DR, the delay in filing of the appeal is condoned and the appeal is admitted for adjudication.
Although a number of grounds have been raised by the assessee, however, these all relate to the order of the Ld. CIT(A) / NFAC in confirming the penalty of Rs.38,24,86,228/- levied by the Assessing Officer u/s 270A of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’).
The Ld. Counsel for the assessee at the outset filed a copy of the order of the Tribunal in assessee’s own case vide order dated 18.03.2025 for assessment year 2018-19 and submitted that the quantum addition has already been deleted by the Tribunal. He accordingly submitted that since the quantum addition has been deleted, therefore, the penalty does not survive.
The Ld. DR fairly conceded that the Tribunal has deleted the addition made by the Assessing Officer and sustained by the Ld. CIT(A) / NFAC.
We have heard the rival arguments made by both the sides, perused the orders of the Assessing Officer and Ld. CIT(A) / NFAC and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find the Assessing Officer in the instant case levied penalty of Rs.38,24,86,228/- u/s 270A on account of addition of Rs.40,21,54,775/- being difference in the capital account and addition of Rs.13,60,27,619/- being difference in the sundry creditors which has been confirmed by the Ld. CIT(A) / NFAC. We find in the quantum proceedings, the Tribunal vide order dated 18.03.2025 has already deleted both the additions, therefore, the penalty does not survive. We, therefore, set aside the order of the Ld. CIT(A) / NFAC and direct the Assessing Officer to cancel the penalty. The grounds raised by the assessee are accordingly allowed.
In the result, the appeal filed by the assessee is allowed.
Order pronounced in the open Court on 27th March, 2025.