DDIT (IT) 2(3)(2), MUMBAI vs. GURGAON INVESTMENTS LTD, MUMBAI

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ITA 2995/MUM/2019Status: DisposedITAT Mumbai19 May 2021AY 2011-122 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the CIT(A)'s order cancelling the penalty. This was because the addition, which formed the basis for the penalty, had already been deleted by the ITAT in a separate quantum appeal.

What were the facts?

The revenue appealed against the CIT(A)'s order cancelling a penalty levied under Section 271(1)(c). The penalty was related to the assessee not charging interest on funds given as CCDs to its overseas Associated Enterprises.

What were the issues?

Whether a penalty under Section 271(1)(c) can survive when the underlying addition has been deleted. Whether furnishing details in a 3CEB report is sufficient to prove full and correct disclosure of income.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “G” BENCH, MUMBAI

Before: SHRI SHAMIM YAHYA, AM & AMARJIT SINGH, JM

For Appellant: Shri Nitesh Joshi
For Respondent: Shri T.S.Khalsa
Hearing: 24/02/2021

O R D E R Per Shamim Yahya, A. M.:

This appeal by the revenue is directed against the order of the learned Commissioner of Income Tax (Appeals)-56, Mumbai (‘ld.CIT(A) for short) dated 08.03.2019 and pertains to the assessment year (A.Y.) 2011-12.

2.

The grounds of appeal read as under:

1. Whether on the facts and on circumstances of the case and in law , the Ld. CIT(A) has erred in cancelling the penalty, levied u/s 271(1)(c) of the I.T. Act by observing that there is no case of furnishing of inaccurate particulars of income, without appreciating the fact that the assessee clearly furnished inaccurate particulars of income by not charging interest to be charged on the funds given as CCDs to its overseas Associated Enterprises even when as per provisions of law it was mandatory to charge it." 2. "Whether on the facts and on circumstances of the case and in law, the Ld. CIT(A) has erred in cancelling the penalty, levied u/s 271(1)(c) of the I.T. Act by observing that the assessee has furnished the relevant detail in 3CEB report, without appreciating the fact that merely providing detail of the transactions made with the Associate entity in 3CEB report is not suffice to prove that it had disclosed full and correct particulars of its income."

2 2995/Mum/2019 3. At the outset in this case, Ld. Counsel of the assessee submitted that the quantum appeal in this case in vide order dated 15/11/2019, the ITAT has deleted the addition. Hence, be pleaded that in this view of this matter, the penalty appeal before the ITAT with reference to above addition does not survive. The Ld. DR could not controvert that ITAT has deleted the addition.

4.

Upon hearing both the parties and perusing the records, we uphold the order of the Ld. CIT(A) deleting this penalty in as much as ITAT has deleted the addition with reference to which this penalty has been levied.

5.

In the result, the revenue’s appeal is dismissed.

Order pronounced in the open court on 19.5.2021.

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