DEPUTY COMMISSIONER OF INCOME TAX , CIRCLE - 7 , PUNE , PUNE vs. TIETO INDIA P LTD, PUNE

We note that this appeal was filed with a delay of 80 days. After hearing both the parties, we find that the reasons stated by the assessee

The appellant-revenue raised three grounds of appeal amongst which the only issue emanates for our consideration is as to whether the CIT(A) justified in deleting the penalty levied by the AO u/s. 271(1)(c) of the Act on account of furnishing inaccurate particulars of income.

At the outset, we note that the quantum appeal in assessee’s own case for A.Y. 2010-11 in ITA No. 1398/PUN/2015 has been remanded to the file of CIT(A) for re-adjudication in view of the issue of Management Service Fee being covered by APA vide its order dated 19-01-2018. We find the said order of which is at Page No. 1 of the paper book of assessee. The CIT(A) in the impugned order at Para No. 2.4 taking into consideration the fact of remanding the issue by the ITAT deleted the penalty imposed by the AO u/s. 271(1)(c) of the Act by holding when the quantum is no more in existence the penalty does not survive. The ld. AR prayed to remand the issue to the file of CIT(A) and drew our attention to the provisions of section 275(1A) of the Act. We note that sub-section (1A) of section 275 explains where the relevant assessment or other order is the subject matter of appeal to CIT(A), ITAT, High Court and Supreme Court is passed, an order imposing or enhancing or reducing or cancelling penalty or dropping the proceedings for the imposition of penalty is to be passed on the basis of assessment as revised by giving effect to such order of CIT(A), ITAT, High Court, Supreme Court or section 263 or 264 of the Act. Therefore, there is no dispute regarding the remanding the issue of Management Service Fee to the file of CIT(A) for re-adjudication in terms of APA. Therefore, we deem

In the result, the appeal of Revenue is dismissed.