HABIB KHAN,JAIPUR vs. ACIT, JAIPUR
What did the Tribunal hold?
The Tribunal noted that the quantum addition, which formed the basis for the penalty, was set aside by a coordinate bench. Consequently, the penalty proceedings were also set aside.
What were the facts?
The Assessing Officer imposed a penalty of Rs. 61,770/- under Section 271(1)(c) for concealing income. The CIT(A) confirmed the penalty, citing non-compliance and the non-existence of a related entity at the given address. However, the quantum addition was later set aside by a coordinate bench.
What were the issues?
Whether penalty under Section 271(1)(c) can be sustained when the underlying addition has been set aside. The issue also involves the validity of penalty proceedings when the quantum appeal is remitted.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, JAIPUR BENCHES (SMC
Before: SHRI BHAGCHANDvk;dj vihy la-@ITA No. 985/JP/2016
आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR Jh Hkkxpan] ys[kk lnL;] ds le{k BEFORE: SHRI BHAGCHAND, ACCOUNTANT MEMBER vk;dj vihy la-@ITA No. 985/JP/2016 fu/kZkj.k o"kZ@Assessment Year : 2008-09 cuke Habib Khan, A.C.I.T., Vs. P/o-M/s H.K. Export Corporation, Circle-2, 2259, Takiya Yaqeen Shah, Ch.- Jaipur. Top Khana Huzoori, Jaipur. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: ABBPK 5855 P vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri P.C. Parwal (CA) jktLo dh vksj ls@ Revenue by : Smt. Poonam Rai (DCIT) & Shri R.A. Verma (Addl.CIT) lquokbZ dh rkjh[k@ Date of Hearing : 23/02/2017 mn?kks"k.kk dh rkjh[k@ Date of Pronouncement : 27/02/2017 vkns'k@ ORDER PER: BHAGCHAND, A.M. This is an appeal filed by the assessee against the order dated 31/08/2016 passed by the ld. CIT(A)-I, Jaipur for the A.Y. 2008-09. The only issue involved in this appeal is confirming the levy of penalty of Rs. 61,770/- made U/s 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred as the Act).
ITA 985/JP/2016_ 2 Habib Khan Vs. ACIT
The Assessing Officer passed order in this case on 29/11/2010 and
a detailed penalty order was passed after considering the various case
laws. After giving reasonable opportunity of being heard to the assessee,
the ld Assessing Officer imposed penalty U/s 271(1)(c) of the Act, 1961
at Rs. 61,770/-, which is 100% of tax sought to be evaded on concealing
income.
Being aggrieved by the order of the Assessing Officer, the
assessee carried the matter before the ld CIT(A), who had confirmed the
penalty by observing as under:-
“I have duly considered the submissions of the appellant, penalty order and the material placed on record. It is noted from the assessment order that during the course of assessment proceedings, the AO required the appellant to produce M/s Lotus Impex, however, no compliance was made. Even the summons issued by the AO to M/s Lotus Impex u/s 131 of the Act was received back unserved. Even the Income Tax Inspector on spot verification, reported that M/s Lotus Impex do not exist at the address provided by the appellant. On the basis of these specific facts, the AO made the specific addition and not the estimated one as claimed by the appellant. The reliance upon the order of Ld. CIT(A) for the AY 2006- 07 is of no help to the
ITA 985/JP/2016_ 3 Habib Khan Vs. ACIT
appellant as principle of res judicata do not apply to income tax proceeding and each assessment year is separate and independent one, as the fact may differ in different assessment year. It is, therefore, held that the AO was justified in imposing penalty of Rs. 61,770/- u/s 271(1) (c) of the Act for furnishing inaccurate particulars of income.
Now the assessee is in appeal before this Bench. The ld AR of the
assessee has submitted that the in quantum appeal, addition has been
set aside by the Hon’ble Bench vide order dated 23/10/2015 passed in
ITA No. 415/JP/2013. When quantum appeal is set aside, there is no
point to decide the penalty proceeding accordingly. Therefore, he prayed
to restore the same to the Assessing Officer.
At the outset, the ld Sr. DR has accepted the assessee’s proposal.
I have heard the rival contentions of both the parties and perused
the material available on the record. The Coordinate Bench vide order
dated 23/10/2015 passed in ITA No. 415/JP/2013 had set aside this issue
to the Assessing Officer, therefore the penalty proceeding is also set
aside to the Assessing Officer and he is free to imposes penalty as per
law. Accordingly, this appeal is also set aside to the Assessing Officer.
ITA 985/JP/2016_ 4 Habib Khan Vs. ACIT 7. In the result, the assessee’s appeal is allowed for statistical
purposes only.
Order pronounced in the open court on 27/02/2017.
Sd/- ¼Hkkxpan½ (BHAGCHAND) ys[kk lnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 27th February, 2017 *Ranjan आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू vihykFkhZ@The Appellant- Shri Habib Khan, Jaipur. 1. izR;FkhZ@ The Respondent- The A.C.I.T., Circle-2, Jaipur. 2. vk;dj vk;qDr@ CIT 3. vk;dj vk;qDr¼vihy½@The CIT(A) 4. विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 5. xkMZ QkbZy@ Guard File (ITA No. 985/JP/2016) 6. vkns'kkuqlkj@ By order,
सहायक पंजीकार@Aेेज. त्महपेजतंत
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