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Income Tax Appellate Tribunal, “B” BENCH, PUNE
Before: SHRI R.S. SYAL, VP & SHRI VIKAS AWASTHY, JM
आदेश / ORDER
PER VIKAS AWASTHY, JM
This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals)-2, Pune dated 22.07.2016 for the assessment year 2005-06 against confirming the levy of penalty u/s. 271(1) (c) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’).
2 ITA No.2606/PUN/2016 A.Y.2005-06
Shri Pushpak B. Mundada appearing on behalf of the assessee
submitted at the outset that penalty u/s.271(1)(c) of the Act was levied in
respect of addition of Rs.16,00,000/- on account of unexplained investment
in re-assessment proceedings. The assessee challenged the validity of re-
assessment proceedings along with additions on merit before the
Commissioner of Income Tax (Appeals). However, the assessee was
unsuccessful. The assessee carried the matter in appeal before the Tribunal
in ITA No.308/PN/2015. The Tribunal vide order dated 05.08.2016 held the
re-assessment order passed u/s.143(3) r.w.s.147 of the Act as invalid.
Penalty vide order 26.03.2015 u/s.271(1)(c) of the Act was levied in respect
of addition made in re-assessment proceedings. Now, that the re-
assessment proceedings have been held to be bad in law by the Tribunal,
hence, penalty is liable to be deleted. The ld. AR furnished a copy of order of
the Tribunal in ITA No. 308/PN/2015 for assessment year 2005-06 decided
on 05.08.2016.
Shri Pankaj Garg representing the Department fairly admitted that
the Tribunal had set aside the assessment order passed u/s.143(3) r.w.s.
147 of the Act.
Both sides heard. Orders of the Authorities below perused. Penalty
u/s. 271(1)(c) of the Act has been levied in respect of addition of
Rs.16,00,000/- made during re-assessment proceedings. The Tribunal in
assessee’s appeal in ITA No.308/PN/2015(supra.) has held the
reassessment order dated 22.12.2009 passed u/s.143(3) r.w.s. 147 of the
Act as invalid. Since, the substratum for levy of penalty has been eroded;
3 ITA No.2606/PUN/2016 A.Y.2005-06
penalty arising from the addition does not survive. Accordingly, impugned order is set aside and appeal of the assessee is allowed.
In the result, appeal of the assessee is allowed.
Order pronounced in open Court after hearing on Monday, the 29th day of October, 2018.
Sd/- Sd/- R. S. SYAL VIKAS AWASTHY VICE-PRESIDENT JUDICIAL MEMBER
पुणे / Pune; �दनांक / Dated : 29th October, 2018 SB आदेश क� ��त�ल�प अ�े�षत / Copy of the Order forwarded to :
अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The CIT(Appeals)-2, Pune. 4. The Pr. CIT-1, Pune. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, “बी” ब�च, 5. पुणे / DR, ITAT, “B” Bench, Pune. गाड� फ़ाइल / Guard File. 6.
// True Copy // आदेशानुसार / BY ORDER,
�नजी स�चव / Private Secretary आयकर अपील�य अ�धकरण, पुणे / ITAT, Pune.