Loading judgment…
Facts
The assessee filed five appeals against penalty orders for AY 2019-20 to 2021-22. These penalty orders were passed ex-parte by the AO. The assessee had appealed against the quantum additions before the CIT(A), but these appeals were filed with a delay, which was not condoned.
Held
The Tribunal held that the fate of penalty orders is dependent on the quantum additions and the AO should have waited for the CIT(A)'s decision on the quantum appeals. The appeals were remitted back to the AO for fresh adjudication, granting the assessee an opportunity to be heard.
Key Issues
Whether penalty orders can be passed ex-parte before the disposal of quantum addition appeals by CIT(A), and if such penalties should be set aside or remitted for fresh adjudication.
Sections Cited
270A, 271DA, 270AAC(1)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, JAIPUR BENCHES,”SMC” JAIPUR
Before: SHRI MANISH BORAD, AM vk;dj vihy la-@ITA. No. 904, 906, 907 & 908/JPR/2025
vkns'k@ ORDER PER: MANISH BORAD, AM These 5 appeals at the instance of the assessee are directed against separate orders of ld. CIT(A), Jaipur dated 10.06.2025 arising out of various penalty orders for A.Y 2019-20 to 2021-22. to 908/JPR/2025 Crystal Metal Industries, Alwar.
At the outset, ld. Counsel for the assessee submitted that the impugned 5 appeals comprises relating to A.Y. 2019-20 for penalty levied u/s 270A of the Act, ITA No. 905/JPR/2025 relating to A.Y. 2019-20 involving the issue of penalty levied u/s 271DA of the Act, ITA No. 906/JPR/2025 for A.Y. 2019-20 involving the issue of penalty levied u/s 270AAC(1) of the Act, for A.Y. 2021-22 involving the issue of penalty levied u/s 271DA of the Act. He submitted that all the penalty orders framed under various sections referred above are exparte.
Learned counsel for the assessee made multi fold contentions stating as follows:- The penalty order have been passed prior to the disposal of the appeals by Ld. CIT(A) filed against the quantum additions. Ld. AO erred in observing that against the assessment orders, the assessee has not preferred any appeal. Since appeals of quantum additions are still pending before ld. CIT(A), the impugned issues of penalty deserves to be restored to the files of Ld. AO.
On the other hand, the departmental representative vehemently argued supporting the orders of lower authorities.
I have heard rival contentions and perused the records placed before me. The appeal before me are arising out of penalty levied u/s 270A for A.Y. 2019-20, 271DA for A.Y. 2019-20, 2020- 21 and 2021-22 and 270AAC(1) for A.Y. 2019-20. I observe that against the penalty orders referred above the assessee filed appeal before Ld. CIT(A) with a delay of 168, 175, 152,173, and 152 days. The common reason for the delay was on account of the health issue of the main managing partner and death of the family member. Ld. CIT(A) did not condoned the delay and dismissed the appeal in limine.
Before me Ld. Counsel for the assessee has stated that against quantum addition, the assessee has preferred appeal for A.Y. 2019-20 on 22.01.2025, for A.Y. 2020-21 on 06.02.2024 and AY 2021-22 on 07.02.2024 Ld. Counsel for the assessee as an Officer of Court states all the three quantum appeals are pending before the ld. CIT(A) for necessary adjudications. I further note that to 908/JPR/2025 Crystal Metal Industries, Alwar. when the appeal of quantum additions were pending before the Ld. CIT(A) and time of limit for framing the penalty orders u/s 270A, 271AAC(1) and 271 DA was not expiring are how could Ld. AO assumed that the assessee is not interested for perusing the appeal, and on such wrong presumption ld. AO proceeded to framed the penalty orders.
The fate of levying penalty is dependent upon the quantum addition and Ld. AO should have waited for the passing of the order by Ld. CIT(A) relating to quantum appeal unless otherwise barred by limitation. I therefore, considering the facts and circumstances of the case remit back all the issue raised in the instant appeal regarding levy of penalty u/s 270A, 271AAC(1), 271DA for A.Y. 2019-20 and levy of penalty u/s 271DA for A.Y. 2020-21 and A.Y. 2021-22 to the file of ld. Jurisdictional Assessing Office for afresh adjudication in terms of my discussion made needs above. Needless to mention that proper opportunity of being heard should be granted to the assessee. The assessee should also refrain from seeking unnecessary adjournment unless otherwise required for reasonable cause. Effective Grounds of appeal
raised by the assessee in the instant appeals are allowed to 908/JPR/2025 Crystal Metal Industries, Alwar. for statistical purposes.
8. In the result, appeals filed by the assessee in to 908/JPR/2025 are allowed for statistical purposes. Order pronounced in the open Court on 03/07/2025.