ACIT CENTRAL CIRCLE 3(1), CHENNAI vs. KAIVALLYA ENTERTAINMENT (P) LTD., CHENNAI

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ITA 1832/CHNY/2019Status: DisposedITAT Chennai03 September 2019AY 2008-093 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that since the quantum appeal of the assessee was allowed, the penalty imposed under Section 271(1)(c) had no legs to stand. Therefore, the Revenue's appeal was dismissed.

What were the facts?

The Revenue appealed against the CIT(A)'s order which allowed the assessee's appeal against a penalty imposed under Section 271(1)(c). The CIT(A) had reasoned that since the quantum appeal of the assessee was allowed by the ITAT, the penalty had no basis.

What were the issues?

Whether a penalty under Section 271(1)(c) can be sustained when the underlying addition on which it was levied has been deleted by the Tribunal.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI

Before: SHRI GEORGE MATHAN & SHRI S. JAYARAMAN

Hearing: 03.09.2019Pronounced: 03.09.2019

आदेश / O R D E R

Per S.JAYARAMAN, AM:

1.

The Revenue filed this appeal against the order of the Commissioner of Income Tax (Appeals)-7, Chennai in (T-14)/CIT(A)-7/2016-17 dated 27.03.2019, who allowed the assessee’s appeal against the order passed U/s.271(1)(c) for the assessment year 2008-09.

2.

The Ld.DR submitted that the Hon’ble ITAT allowed the quantum appeal of the assessee in for the assessment year 2008-09 dated 27.07.2017. Consequent to passing the assessment order, the Assessing Officer levied penalty U/s.271(1)(c) in C.No.CC 3(1)/AADCK0637K/2015-16 dated 24.03.2016 at Rs.67,21,946/- against which the assessee filed an appeal before the CIT(A). The Ld.CIT(A) found that the Hon’ble Tribunal has passed the quantum appeal vide its order dated 27.07.2017, therefore the penalty imposed U/s.271(1)(c) has no legs to stand on and allowed the appeal. Since, the Revenue has filed an appeal against the order of ITAT before the Hon’ble High Court, the Ld.DR pleaded that the appeal may be decided on merit. Per contra, the Ld.AR supported the order of the Ld.CIT(A).

3.

We have heard the rival submissions. Since the Tribunal has allowed the quantum appeal, supra, as held by the Ld.CIT(A), the penalty imposed U/s.271(1)(c) has no legs to stand. Therefore, the Revenue’s appeal is dismissed.

4.

In the result, the appeal of the Revenue is dismissed.

Order pronounced in the open court on 3rd September, 2019 at Chennai.

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