INCOME TAX OFFICER 9(2)(2), MUMBAI, MUMBAI vs. CAPRO VALVAS & CONTROLS PRIVATE LIMITED, MUMBAI

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ITA 5980/MUM/2019Status: DisposedITAT Mumbai31 March 2021AY 2009-103 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 held that the CBDT Circular No. 17/2019, which provides an exception for quantum assessment proceedings, is not applicable to penalty proceedings. Penalty and assessment proceedings are distinct and separate.

What were the facts?

The appeals were filed by the Revenue against the order of the CIT(A) concerning penalty imposed under Section 271(1)(c) for bogus purchases. The Revenue argued that the penalty should be levied in respect of the disallowance made.

What were the issues?

Whether CBDT Circular No. 17/2019, applicable to quantum assessment, can be extended to penalty proceedings. Whether penalty proceedings are distinct from assessment proceedings.

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, ‘C‘ BENCH

Before: SHRI MAHAVIR SINGH & SHRI M.BALAGANESH & &

For Appellant: Ms. Shreekala Pardeshi
For Respondent: Shri Dev Vora, Ms. Shreekala Pardeshi
Hearing: 31/03/2021Pronounced: 31/03/2021

आदेश / O R D E R PER M. BALAGANESH (A.M):

1.

These appeals in 5981/Mum/2019 for A.Y.2009-10 & 2011-12 arise out of the order by the ld. Commissioner of Income Tax (Appeals)-16, Mumbai in appeal No.CIT(A)-16/IT-10385/ITO- 9(2)(2)/2018-19 & CIT(A)-16/IT-10386/ITO-9(2)(2)/2018-19 respectively dated 28/06/2019 (ld. CIT(A) in short) in the matter of imposition of penalty u/s.271(1)(c) of the Income Tax Act (hereinafter referred to as Act).

2.

The ld. DR argued vehemently that the penalty levied by the ld. AO in respect of disallowance made on bogus purchases. Accordingly, in the opinion of the ld. DR, the same would fall within the exception provided in the CBDT Circular No.17/2019 dated 08/08/2019. We find that the exception provided in the said Circular dated 08/08/2019 issued by the CBDT would apply only in respect of quantum assessment proceeding and the same cannot be made applicable for penalty proceeding and it is well settled that penalty proceeding and assessment proceedings are distinct and separate. In view of this, we are inclined to treat these appeals as not maintainable in view of the CBDT Circular No.17/2019 dated 08/08/2019 treating it as an appeal involving tax effect less than the prescribed monetary limit.

3.

In the result, appeals filed by the revenue are dismissed as not maintainable.

Order pronounced in the open Court on 31/03/2021.

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