SHRI ANAND PRAKASH,GHAZIABAD vs. ACIT, GHAZIABAD

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ITA 3209/DEL/2015Status: DisposedITAT Delhi10 September 2018AY 2009-102 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 held that since the original assessment order, which formed the basis for the penalty, was set aside, the penalty proceedings had become infructuous. Therefore, the penalty order and the proceedings were directed to be deleted.

What were the facts?

The penalty proceedings were initiated based on an original assessment order. However, this original assessment order was subsequently set aside by the CIT under Section 263, leading to a fresh assessment. The penalty order in question arose from the now-invalidated original assessment.

What were the issues?

Whether penalty proceedings initiated based on an assessment order that has been subsequently set aside are valid.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 263,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “B-+”: NEW DELHI

Before: SHRI AMIT SHUKLA & SHRI O.P. KANT

For Appellant: Shri Dinesh Kumar, Advocate, Shri Anshul Agarwal, CA
For Respondent: Ms. Ashima Neb, Sr. DR
Hearing: 10/09/2018

The aforesaid appeal has been filed by the assessee against order dated 27.2.2015 passed by Ld. CIT(Appeals) Muzaffarnagar in relation to the penalty proceedings u/s 271(1)(c). 2 At the outset, Ld. Counsel for the assessee submitted that the impugned penalty proceedings are arising out of original assessment order dated 28.12.2011 passed u/s 143(3) on account of amount of Rs. 10 lacs surrendered before the AO. However, the said assessment order now has been set aside by the Ld. CIT Ghaziabad in his order passed u/s 263 dated 30.3.2014 wherein entire assessment has been set aside to the AO to frame a fresh assessment order. In pursuance of such an order u/s 263, fresh assessment order has been passed by the AO vide order dated 25.3.2015 in pursuance of which fresh penalty proceedings have been initiated. Accordingly, the impugned penalty order has become infructous and deserves to be set aside. Ld. DR also admitted that the impugned penalty order is arising out of original assessment order which has been set aside by the Ld. CIT u/s 263.

3.

In view of the aforesaid facts that the quantum of assessment order passed u/s 143(3) which is a subject matter of penalty before us has been set aside by the Ld. CIT in his revisionary division u/s 263 and fresh assessment order has already been passed and penalty proceedings have been initiated. Therefore, the penalty order as well as the proceedings is to be set aside. Accordingly the penalty proceeding by the AO is directed to be deleted on the aforesaid ground.

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