SHRI ABHIJIT UTTAMRAO DESHMUKH,BEED vs. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-3, AURANGABAD, AURANGABAD

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.83,04,375/- levied by the Assessing Officer u/s 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’).

Facts of the case in brief, are that the assessee is an individual. On the basis of information received from Dy. Director of Income Tax (Inv.) that the assessee has received an amount of Rs.2.5 crores in financial year 2010-11 against sale of land to Hi-tech Engineering Corporation India Pvt. Ltd., Baramati and the said amount has been written off by Hi-tech Engineering Pvt. Ltd. in their balance sheet, the case of the assessee was reopened as per the provisions of section 147 of the Act. Accordingly, notice u/s 148 of the Act was issued. The assessee had neither filed the original return nor filed any return in response to the notice u/s 148. The notice issued u/s 142(1) also remains un-complied with. The Assessing Officer, therefore, completed the assessment u/s 144 of the Act determining total income of the assessee at Rs.6,17,50,440/- by adding the amount of Rs.2.5 crores to the total income of the assessee.

The assessee filed an appeal before the Ld. CIT(A) / NFAC which was pending. In the meantime, the Assessing Officer initiated penalty proceedings u/s 271(1)(c) of the Act. In absence of any compliance from the side of the assessee to the notice u/s 271(1)(c) of the Act, the Assessing Officer levied penalty of Rs.83,04,375/- u/s 271(1)(c) of the Act being the minimum penalty leviable.

In appeal, the Ld. CIT(A) / NFAC confirmed the penalty levied by the Assessing Officer.

Aggrieved with such order of the Ld. CIT(A) / NFAC, the assessee is in appeal before the Tribunal.

We have heard the rival arguments made by both the sides and perused the orders of the Assessing Officer and Ld. CIT(A) / NFAC. We find in the instant case the quantum appeal is pending before the Ld. CIT(A) and in the meantime, the Assessing Officer initiated penalty proceedings u/s 271(1)(c) of the Act and levied penalty of Rs.83,04,375/- u/s 271(1)(c) of the Act. Since the quantum appeal is still pending before the Ld. CIT(A) / NFAC, therefore, considering the totality of the facts of the case, we deem it proper to restore the issue back to the file of the Ld. CIT(A) / NFAC with a direction to decide the penalty appeal after the quantum appeal is decided. Needless to say, he shall give due opportunity of being heard to the assessee and decide the issue as per fact and law. The assessee is also hereby directed to participate in the appellate proceedings on the appointed date without seeking any adjournment under any pretext, failing which the Ld. CIT(A) / NFAC is at liberty to pass appropriate order as per law. We hold and direct accordingly. The grounds raised by the assessee are accordingly allowed for statistical purposes.

In the result, the appeal filed by the assessee is allowed for statistical purposes.