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Facts
The assessee's return for AY 2015-16 was assessed under Section 143(3), leading to an addition of Rs. 62,83,625/- due to a discrepancy in gross receipts as per Form 26AS. The CIT(A) dismissed the appeal for non-prosecution. Subsequently, the quantum appeal was remitted back to the AO for de novo assessment by the Tribunal, but meanwhile, the AO levied a penalty of Rs. 19,60,490/- under Section 271(1)(c). This appeal concerns the penalty order.
Held
The Tribunal noted that the quantum assessment, which was the basis for the penalty, had already been remitted back to the AO for a fresh assessment. Therefore, in accordance with Section 275(1)(a) of the Income Tax Act, the present penalty appeal is also remanded back to the file of the AO.
Key Issues
Whether a penalty levied under Section 271(1)(c) is sustainable when the underlying quantum assessment, upon which the penalty is based, has been remitted back to the Assessing Officer for a de novo assessment.
Sections Cited
143(3), 271(1)(c), 275(1)(a)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, COCHIN BENCH
Before: SHRI INTURI RAMA RAO, AM & SHRI MANU KUMAR GIRI, JM
O R D E R Per: Inturi Rama Rao, AM This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre, Delhi (NFAC) dated 13.08.2025 for Assessment Year (AY) 2015-16.
Brief facts of the case are that appellant is an individual. The return of income for AY 2015-16 was filed on 31.08.2016 declaring total income of Rs. 8,96,870/-. Against the said return of income, the assessment was completed by the Income Tax Officer, Ward 2(1), Kozhikode vide order dated 29.12.2017 passed u/s. 143(3) of the Koyamu Kakkat Act at a total income of Rs. 71,80,500/-. While doing so, the AO made addition of Rs. 62,83,625/- on account of alleged discrepancy in the gross receipts as per Form 26AS with regard to gross receipts credited to Profit & Loss A/c.
Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order dismissed the appeal for non prosecution.
On further appeal before this Tribunal, this Tribunal in vide order dated 16.05.2025 remitted the matter back to the file of the AO for de novo assessment. Meanwhile, the AO had proceeded with levy of penalty for concealment of income and levied penalty of Rs. 19,60,490/- u/s. 271(1)(c) of the Act vide order dated 24.03.2005.
Being aggrieved, the appellant is in appeal before this Tribunal in the present appeal.
When the appeal was called on nobody appeared on behalf of the assessee despite due service of notice of hearing. Therefore, we proceeded to dispose of the appeal after hearing the learned Sr. DR.
At the outset, we find that the quantum appeal was remitted back to the file of the AO vide order dated 16.05.2025 in ITA No. 228/Coch/2025. Therefore, in terms of section 275(1)(a) of the Act the present appeal is also remanded back to the file of AO.
Order pronounced in the open court on 19th November, 2025.