SUDHA JAJODIA,NEW DELHI vs. ACIT, CENTRAL CIRCLE- 8, NEW DELHI

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ITA 3660/DEL/2019Status: DisposedITAT Delhi13 August 2019AY 2011-124 pages

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

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal noted that the additions on which the penalty was imposed had been deleted by the ITAT in a prior quantum appeal. Therefore, the penalty could not survive.

What were the facts?

The Assessing Officer (AO) levied a penalty under Section 271(1)(c) of the Income Tax Act based on additions made from documents seized during a search. The assessee argued that these documents were mere estimates and that sufficient withdrawals were made to cover any potential expenditure.

What were the issues?

Whether a penalty under Section 271(1)(c) can be sustained when the underlying additions have been deleted. The validity of the penalty notice was also questioned.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 274

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “I.2”, NEW DELHI

Before: SHRI H.S. SIDHU & SHRI PRASHANT MAHARISHI

ORDER PER H.S. SIDHU : JM

This appeal by the Assessee is directed against the impugned order dated 20.2.2019 passed by the Ld. CIT(A)-24, New Delhi on the following grounds:-

1(a) The CIT(A) order, confirming the penalty, levied Rs. 20,19,976/- u/s. 271(1)(c) of the Act, by the AO is bad in law, wrong on facts and against the principles of natural justice. (b) The Ld. CIT(A) has failed to appreciate that notice u/s. 274 r.w.s. 271(1)c) has been issued in printed form without specifying the grounds for initiation of penalty proceedings and thus is invalid and untenable in law.

2.

The Ld. CIT(A) has failed to appreciate that appellant has not furnished inaccurate particulars of its income or concealed its income with the intention of 1

suppressing the taxable income and therefore provision of section 271(1)(c) of the Act, are not attracted at all. 3(a) The Ld. CIT(A) has erred in law and on facts of the case in confirming the penalty of Rs. 20,19,976/- on the basis of additions made towards documents seized from the residence of the appellant, totaling to Rs. 65,37,139/- for AY 2011-12, alleging to be purchases made in cash, towards various purchases like jewellery/ ladies garments / cloths, gifts items/ silver art etc. from undisclosed income on mere conjectures and surmises. (b) The Ld. CIT(A) has erred in law and on facts of the case in not appreciating the explanation filed by the appellant that these documents are mere dumb documents /scribbles / estimate and the AO had failed to bring on record any document or material on the basis of which it would have been proved that the appellant had incurred these expenditure. © The Ld. CIT(A) has erred in law and on facts of the case in not appreciating that there were sufficient withdrawals made by the appellant, her husband and her son and normal petty expenditure even if purchased, were well within the drawings made by the family. d) The Ld. CIT(A) has erred in law and on the facts of the case in not appreciating the fact that in respect of huge addition of Rs. 43,47,869/- towards jewellery calculations of page R-2/A-1/21, there was no addition made in the Wealth Tax Assessment of the appellant, as there was no discrepancy in the jewellery/ silver items etc. as inventoried by the Departmental Valuer on the date of search i.e. 19.11.2010 and regularly disclosed in the Wealth Tax Return and therefore any such alleged expenditure is not represented by such itme of jewellery.

The appellant craves leave to add, alter, amend, forego or delete any of the grounds of appeal before or at the time of hearing.

2. Facts narrated by the revenue authorities are not disputed by both the parties, hence, the same are not repeated here for the sake of convenience.

3. At the time of hearing, Ld. Counsel of the Assessee, has stated that ITAT vide its order dated 28.5.2019 in quantum Appeal No. 4019/Del/2016 (AY 2011-12) has deleted the entire additions on which the penalty in dispute has been imposed. In this behalf he filed the copy of the Tribunal’s Order dated 28.5.2019 in assessee’s own case and he requested that penalty in dispute may be deleted.

4.

On the contrary, Ld. DR has not raised any serious objection on the request of the Ld. Counsel for the assessee.

5.

We have carefully considered the submissions and perused the records. We find that in assessee’s own case the ITAT vide its order dated 28.5.2019 in quantum appeal No. 4019/Del/2016 (AY 2011-12) has deleted the entire additions on which the penalty in dispute has been imposed, hence, the penalty in dispute will not survive. Accordingly, we delete the penalty in dispute in this appeal.

6.

In the result, the Appeal filed by the Assessee stands allowed.

Order pronounced in the Open Court on 13/08/2019.

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