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Income Tax Appellate Tribunal, “F” BENCH, MUMBAI
Before: SHRI SAKTIJIT DEY & SHRI MANOJ KUMAR AGGARWAL
Date of Hearing – 13.05.2019 Date of Order – 17.05.2019
O R D E R PER SAKTIJIT DEY. J.M.
The aforesaid appeal has been filed by the assessee challenging 9th the order dated October 2017, passed by the learned Commissioner (Appeals)–37, Mumbai, confirming the penalty imposed of ` 7,33,445, u/s 271(1)(c) of the Income–tax Act, 1961 (for short "the Act") for the Assessment Year 2010–11
2 Ujjwal Singh Rana 2. Brief facts are, while completing the assessment in assessee’s case for the impugned assessment year, the Assessing Officer disallowance assessee’s claim of deduction under section 54 of the Act. On the basis of such disallowance, the Assessing Officer initiated proceedings under section 271(1)(c) of the Act and ultimately passed an order under the said provision imposing penalty of ` 7,33,445, alleging furnishing of inaccurate particulars of income.
Though, the assessee challenged the imposition of penalty by filing appeal before the learned Commissioner (Appeals), however, the penalty imposed was sustained by learned Commissioner (Appeals).
At the outset, the assessee appearing in person, submitted that, in the meanwhile, while deciding the quantum appeal of the assessee for the very same assessment year in ITA no.1601/Mum./2016, dated 8th June 2018, the Tribunal has allowed assessee’s claim of deduction under section 54 of the Act. Therefore, he submitted, in view of the order passed by the Tribunal, penalty imposed under section 271(1)(c) of the Act should be deleted.
The learned Departmental Representative agreed that the addition on the basis of which penalty under section 271(1)(c) of the Act was imposed has been deleted by the Tribunal.
3 Ujjwal Singh Rana 6. We have considered rival submissions and perused material on record. It is evident, the basis for imposition of penalty under section 271(1)(c) of the Act is the disallowance of assessee’s claim of deduction under section 54 of the Act. However, as could be seen, the Tribunal while deciding assessee’s quantum appeal in the order referred to above has allowed assessee’s claim of deduction under section 54 of the Act. Therefore, the very foundation on which the penalty under section 271(1)(c) of the Act was imposed no longer exists. That being the case, the penalty imposed under section 271(1)(c) of the Act cannot also survive. Accordingly, we delete the penalty imposed under section 271(1)(c) of the Act for the impugned assessment year. Grounds are allowed.
In the result, appeal is allowed. Order pronounced in the open Court on 17.05.2019