Loading judgment…
Facts
The assessee filed an appeal against the penalty levied under Section 271(1)(c) of the Act. The appeal was time-barred by 5 days, which was condoned. The assessee's appeal against the additions in quantum proceedings was pending before the Ld. CIT(A), yet the penalty was confirmed.
Held
The tribunal held that if quantum additions are deleted on merits, no penalty can be levied for concealment of income. In the interest of justice, the levy of penalty was set-aside to be taken up along with the quantum appeal.
Key Issues
Whether penalty under Section 271(1)(c) can be confirmed when the quantum appeal against the additions is still pending?
Sections Cited
271(1)(c), 143(3)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “SMC” BENCH, AHMEDABAD
Before: SHRI SIDDHARTHA NAUTIYAL & SHRI MAKARAND V. MAHADEOKAR
(Assessment Year: 2016-17) Shailendrakumar Mansingrao Bhoite, Vs. Assistant Commissioner of 201, Subhadra Avenue, B/h. Akshar Income Tax, Pavilion Yoginagar, Gotri, Circle-3(1), Vadodara-390021 Vadodara [PAN No.ADCPB9899D] (Appellant) .. (Respondent) Appellant by : Shri Niraj Shah, A.R. Respondent by: Shri Ravindra, Sr. DR Date of Hearing 05.05.2025 08.05.2025 Date of Pronouncement O R D E R
PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER:
This appeal has been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Appeals), (in short “Ld. CIT(A)”), National Faceless Appeal Centre (in short “NFAC”), Delhi confirming levy of penalty under Section 271(1)(c) of the Act vide order dated 30.06.2024 passed for A.Y. 2016-17.
At the outset, we observe that the appeal is time barred by 05 days. The delay of 05 days is condoned on due consideration of facts and owing to smallness of delay causing no perceptible prejudice to other side.
The Assessee has taken the following grounds of appeal:-
“1. The ld. CIT(A) have erred on facts and in law in dismissing the appeal as non-est without adjudication on merits.”
Shailendrakumar Mansingrao Bhoite vs. ACIT Asst.Year –2016-17 - 2– 4. During the course of hearing the Counsel for the assessee submitted that in this case Ld. CIT(A) had confirmed levy of penalty under Section 271(1)(c) on the assessee on account of certain additions amounting to Rs. 33,45,099/- which were added in the hands of the assessee by the Ld. Assessing Officer since the assessee had failed to prove the capacity of the alleged loan creditors. The Counsel for the assessee submitted that the assessee had filed appeal before Ld. CIT(A) on 29.04.2021 against the assessment order dated 22.12.2018 passed by the Assessing Officer under Section 143(3) of the Act. However, till date Ld. CIT(A) has not yet passed the order in the appeal challenging the additions made in quantum proceedings before him. However, while the appeal in relation to quantum proceedings is still pending before Ld. CIT(A), however, Ld. CIT(A) has proceeded to confirm levy of penalty with respect to the same additions, in respect of which quantum appeal is still pending.
On perusal of the contents of the order passed by the Ld. CIT(A), it is observed that there was delay of 614 days in filing of appeal before Ld. CIT(A) against the penalty order passed by the Assessing Officer under Section 271(1)(c) of the Act. Further, the assessee also did not provide any explanation for such delay before Ld. CIT(A). However, it is a well settled law that if the quantum additions are themselves deleted on merits, then in respect of such quantum additions, there is no question of levy of penalty under Section 271(1)(c) of the Act for concealment of income. Accordingly, in our considered view, in the interest of justice, the levy of penalty is set-aside to the file of Ld. CIT(A), to be taken up along with appeal filed by the assessee against quantum proceedings. The Counsel for the assessee submitted that the assessee has a good case on merits and if given an opportunity of hearing, he would be able to satisfy the Revenue Authorities that this is not a fit case for making any additions in the hands of the assessee.
In the result, the appeal of the assessee is allowed for statistical purposes. This Order pronounced in Open Court on 08/05/2025