HOTEL PRANAMINN PRIVATE LIMITED,BHUBANESWAR vs. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-2(1), BHUBANESWAR, BHUBANESWAR

Ld. AR submitted that the ld. CIT(A) has dismissed the appeal of the assessee against the penalty levied u/s.271(1)(c) of the Act on account of delay in filing the appeal of 2890 days. It was the submission that the directors of the assessee company were hiding on account of DRT proceedings and the managing director was also behind the bar. It was also the submission that on merits the addition made in the hands of the assessee has been deleted by the ld. CIT(A) and the revenue has not filed any further appeal before the Tribunal. It was the submission that the quantum addition itself having been deleted, the penalty u/s.271(1)(c) of the Act is not liable to be levied. It was the submission that when technicality is pitted against substantial justice, the substantial justice would prevail.

In reply, ld. CIT-DR vehemently supported the orders of the AO and ld. CIT(A). It was the submission that the assessee should have been diligent.

We have considered the rival submissions. As it is noticed that the additions in the quantum assessment, which has led to the levy of panty has been deleted by the ld. CIT(A) in the quantum proceedings, obviously legs for the levy of penalty no more survives. This being so, we are of the view that the delay before the ld. CIT(A) should have been condoned and the appeal should have been disposed off. As pointed out by the ld. AR when technicality is pitted against substantial justice, the substantial justice would prevail, this being so, as the quantum addition itself has been deleted, the penalty has no more legs to survive. Thus, the delay in filing the appeal before the ld. CIT(A) is condoned and the penalty as levied by the AO u/s.271(1)(c) of the Act and as confirmed by the ld. CIT(A) is deleted.