RAJENDRA KUMAR,DELHI vs. ACIT CIRCLE-47(1), NEW DELHI

ORDER PER SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER: This appeal has been preferred by the assessee against the order dated 18.07.2019 passed by the learned Commissioner of Income Tax (Appeals)-16, New Delhi {CIT(A)} and pertains to Assessment Year: 2011- 12 wherein the Ld. CIT (A) has upheld the imposition of penalty of Rs.14,06,005/- imposed u/s 271(1)(c) of the Income Tax Act, 1961 (hereinafter called as the ‘Act’).

2.0 The brief facts of the case are that the return of income was filed at Rs.58,21,680/- and the assessment was completed at an income of Rs.1,13,57,590/- after making an addition on account of alleged unexplained investment in purchase of two properties by the assessee.

The total addition made was Rs.53,47,387/- on account of alleged difference/unexplained investment and the purchase of property. Apart from this, a disallowance of Rs.4,902/- was also made u/s 14A of the Act.

Subsequently, the impugned penalty was imposed against which the assessee preferred an appeal before the learned CIT (A). The assessee’s appeal before the learned CIT (A) was also dismissed and now the assessee has approached the Tribunal challenging the upholding of penalty.

3.0 At the outset, the learned Authorized Representative submitted that the assessee’s appeal in the quantum proceedings challenging the addition on account of alleged investment in the purchase of property, has since been allowed by the ITAT vide order dated 27.02.2020 in ITA No.1959/Del/2017. It was submitted that since the quantum addition has been deleted, no penalty on such addition would survive.

4.0 The learned Sr. Departmental Representative fairly accepted that the quantum addition to which the penalty related had been deleted by the Tribunal.

5.0 Having heard both the parties and after having perused the order of the Tribunal in we agree with the contention of the learned Authorized Representative that since the quantum addition has been deleted by the Tribunal, the impugned penalty u/s 271(1)(c) of the Act would not survive. Accordingly, we delete the impugned penalty.

6.0 In the final result, the appeal of the assessee stands allowed.

Order pronounced in the Open Court on 13/05/2020.