VINOD VALLABHBHAI SANGHANI,JAMNAGAR vs. INCOME TAX OFFICER, WARD 3(5), JAMNAGAR, JAMNAGAR

All the four appeals are interconnected, and relate to one assessee, for one assessment year 2011-12, therefore with the consent of parties, these appeals have been clubbed and heard together and a consolidated order is being passed,

At the outset of hearing, the Ld. Counsel for the assessee submits that assessee has made sufficient compliance during quantum assessment as well as penalty(ies) proceedings. However, when the proceedings before Ld.CIT(A) was going on, then, the assessee requested the ld. CIT(A) to avail VSVS-2020 Scheme and therefore assessee’s quantum appeal was dismissed, by Id CIT(A), on this count. However, later on, the assessee found difficult to deposit the tax amount under the VSVS-2020- Scheme, due to financial difficulty and could not pay the tax demanded by Department. The Ld. Counsel for the assessee contended that now the assessee wants to contest the appeal on merit, and wish to submit some additional documents and evidences before the assessing officer to prove his claim, therefore, the matter may be remitted back to the file of the Assessing Officer for fresh adjudication, on merit. The Ld. Counsel for the assessee stated that assessee has not furnished adequate documents and evidence before Assessing Officer as well as before Ld.CIT(A), and now, the assessee is willing to submit complete documents and evidences. The Ld. Counsel fairly submitted that one more opportunity should be given to the assessee to plead his case before Assessing Officer. The Ld. Counsel also informs the Bench that appeal in ITA No.255/Rjt/2025, relates to quantum proceedings. Since the Tribunal is remitting the quantum proceedings back to the file of Assessing Officer, therefore various penalties imposed u/s 271(1)(c)/271F/271(1)(b) of the Act, may also be remitted back to the file of Assessing Officer on same footing. That is, when the quantum proceeding is remitted back to the file of the assessing officer, then in that circumstances, these penalties should also be restored back to the file of the assessing officer,

The Id. DR for the Revenue, submitted that assessee wanted to avail VSVS-2020- Scheme, therefore, Ld.CIT(A), had rightly dismissed the appeal of the assessee, in quantum proceedings. Later on, the assessee could not adopt VSVS-2020- Scheme, due to financial difficulty, as the assessee was not in a position to deposit the tax demanded by the Department. Therefore, appeal may be revived and should be remitted back to the file of the assessing officer for fresh, adjudication, on merit.

I have heard both the parties and perused the materials available on record. I note that assessee wanted to avail VSVS-2020 -Scheme and informed the Ld.CIT(A) that he wanted to adopt VSVS-2020- Scheme, therefore, the quantum appeal was dismissed by Ld.CIT(A). However, later on, the assessee found difficulty to tax demanded by the Department, due to financial difficulty. Later on, the assessee informed the Ld.CIT(A) that he could not avail VSVS- 2020 Scheme, due to financial difficulties, as the assessee did not have money to pay the department in the said scheme. Now, Ld. Counsel for the assessee, stated that assessee wish to contest his case before lower authorities, by filing more documents and evidences, to prove his claim. Therefore, ld. Counsel

Since I have remitted back the quantum proceedings in ITA No.255/Rjt/2025 to the file of Assessing Officer, therefore, the penalties imposed u/s 271(1)(c)/271F/271(1)(b) of the Act will not survive. That is, when the matter in quantum proceedings have been restored to the file of Assessing Officer, the penalties do not have leg to stand. However, the Assessing Officer is given liberty to initiate fresh penalties, if any, in accordance with law, in fresh

In the combined result, assessee’s appeals (in ITA Nos. 255-257/Rjt/2025 and ITA No. 259/Rjt/2025) are treated as allowed for statistical purposes, in above terms.