INCOME TAX OFFICER, MUMBAI vs. M/S. AMAYA INFRASTRUCTURE PVT LTD, PALGHAR

PDF · subscribers
ITA 5776/MUM/2025Status: DisposedITAT Mumbai29 January 2026AY 2008-09Bench: SHRI AMIT SHUKLA (Judicial Member), SHRI MAKARAND VASANT MAHADEOKAR (Accountant Member)1 pages

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

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that penalty proceedings are consequential. Once the basis for the penalty (the quantum addition) is deleted, the penalty itself cannot be sustained, even if an appeal regarding the quantum addition is pending before a higher court. The deletion of the penalty by the CIT(A) was found to be in line with established judicial principles.

What were the facts?

The Revenue preferred an appeal against the order of the National Faceless Appeal Centre, Delhi, which deleted a penalty levied under section 271(1)(c) for the Assessment Year 2008-09. The penalty was based on a quantum addition that had itself been deleted by the Tribunal.

What were the issues?

Whether the penalty levied under section 271(1)(c) can be sustained when the original quantum addition on which it was based has been deleted.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘A’ BENCH

For Appellant: Shri Tanzil Padvekar
For Respondent: Shri Rajesh Kumar Yadav
Hearing: 22/01/2026Pronounced: 29/01/2026

आदेश / O R D E R PER AMIT SHUKLA (J.M): The present appeal has been preferred by the Revenue against the order dated 04.07.2025 passed by the National Faceless Appeal Centre, Delhi, whereby the learned Commissioner of Income Tax (Appeals) has deleted the penalty levied under section 271(1)(c) of the Income-tax Act, 1961, for the Assessment Year 2008-09.

1.

“Whether the Ld. CIT(A) has erred in deleting the penalty of Rs. 32,65,02,996/- without appreciating that the Revenue has filed appeal before the Hon’ble Bombay High Court (ITXAL/27362/2024) against quantum and the same is pending?”

3.

At the outset, it is an admitted and undisputed position, fairly conceded by both the parties, that the very quantum addition which constituted the sole foundation for the levy of the impugned penalty stood deleted by this Tribunal vide its order dated 10.11.2023. It is equally not in dispute that the penalty under section 271(1)(c) had been levied entirely with reference to the said addition and had no independent or separable basis dehors the quantum proceedings.

4.

Once the very basis on which the penalty was levied no longer survives, the penalty itself cannot be sustained. Penalty proceedings are purely consequential in nature. Once the very addition on which the penalty rests does not survive judicial scrutiny, the penalty cannot independently stand and must necessarily fall. This legal position is well-settled and requires no further elaboration.

5.

The contention of the Revenue that an appeal against the quantum order is pending before the Hon’ble Bombay High Court does not, in our considered view, carry the matter any further. The mere pendency of an appeal does not efface

Amaya Infrastructure Pvt. Ltd. the binding nature of the Tribunal’s order unless the same is stayed, set aside or reversed by a superior forum. So long as the quantum addition stands deleted by a subsisting order of this Tribunal, the levy of penalty cannot be sustained on a speculative premise that the quantum may be restored at some indeterminate future point.

6.

The learned CIT(A), therefore, in deleting the penalty, has merely applied the settled judicial principle that penalty proceedings cannot outlive the quantum addition which alone gave rise to them. No perversity, illegality or infirmity can be discerned in the impugned appellate order warranting any interference.

7.

In view of the foregoing discussion, we find no merit in the ground raised by the Revenue. The same is accordingly dismissed.

8.

In the result, the appeal of the Revenue is dismissed.

Order pronounced on 29th January, 2026.

More judgments on Section 271(1)(c)

All 25,141 judgments and leading authorities on Section 271(1)(c) →

Recent GST High Court judgments

Search GST case law →