VARJU INVESTMENTS PRIVATE LIMITED,SURAT vs. THE DEPUTY COMMISSIONER OF INCOMETAX CIRCLE -2(1) (1), CURRENT JURIS-DCIT CIRCLE2(1) (1) SURAT, SURAT

The assessee in this appeal is aggrieved by the action of the Assessing Officer in confirming the penalty levied by the Assessing Officer u/s. 271(1)(c) of the Act.

At the outset, the ld. counsel for the assessee has stated that the impugned penalty has been levied by the Assessing Officer on the basis of quantum additions made by the Assessing Officer u/s. 68 of the Income Tax Act in the assessment order passed u/s. 143(3) of the Act by treating the share capital received by the assessee as bogus and thereby adding the same as income of the assessee from undisclosed sources. The ld. counsel for the assessee has submitted that the appeal against the quantum additions is still pending before the CIT(A). She has further submitted that decision arrived by the CIT(A) in the quantum appeal will have bearing on the order of levy of penalty u/s. 271(1)(c) of the Income Tax Act. She therefore submitted that the matter be restored to the file of CIT(A) to be decided along with the appeal of the assessee relating to quantum additions vide appeal no. CIT(A), Surat-2/10287/2016-17.

In view of the above facts and circumstances, the impugned order of the CIT(A) is set aside, the matter is restored back to the file of CIT(A) with a direction to decide the issue of levy of penalty along with the appeal of the assessee agitating the quantum additions. Thus, the appeal of the assessee is treated as allowed for statistical purposes.