ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 5(1)(2), MUMBAI vs. M/S. CREATIVE PERIPHERALS AND DISTRIBUTION LTD, MUMBAI

This appeal in A.Y.2009-10 arises out of the order by the ld. Commissioner of Income Tax (Appeals)-10, Mumbai in appeal No.CIT(A)-10, Mumbai/10112/2018-19 dated 31/05/2019 (ld. CIT(A) in short) in the matter of imposition of penalty u/s.271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as Act).

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 this appeal 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.

In the result, appeal filed by the revenue is dismissed as not maintainable. Order pronounced in open Court on 02/03/2021.