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Facts
The revenue filed eight appeals against the deletion of penalties imposed under Section 271(1)(c) for Assessment Years 2012-13 to 2015-16. These penalties were levied following protective income additions and alleged bogus share capital additions. The assessee presented a prior Tribunal order where the underlying quantum additions, both protective and substantive, had been deleted.
Held
The Tribunal held that since the quantum additions, including protective and substantive additions, for which the penalties were levied had already been deleted by a previous Tribunal order, the penalties under Section 271(1)(c) could not be sustained. Consequently, the Tribunal upheld the orders of the CIT(A) deleting these penalties, and thus, the revenue's appeals were dismissed.
Key Issues
Whether penalties levied under Section 271(1)(c) are sustainable when the underlying quantum additions, including protective and substantive additions, have been deleted by the Tribunal.
Sections Cited
271(1)(c), 292C
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Income Tax Appellate Tribunal, DELHI BENCH ‘A’, NEW DELHI
Before: SH. MAHAVIR SINGH & SH. S. RIFAUR RAHMAN
ORDER PER MAHAVIR SINGH, VP: These eight appeals by the revenue are arising out of different orders of CIT(A)-3, Noida in Appeal Nos.CIT(A), Kanpur-4/10008, 10011, 10012, 10016 & 10019/2018-19 dated 05.03.2024 and Appeal No.CIT(A), Kanpur-4/10007, 10010, 10014, 10017 and 10018/2018-19 dated 05.03.2024. The penalties under dispute were levied by DCIT, Central Circle, Noida U/s. 271 (1)(c) of the Income Tax Act, 1961 (hereinafter referred as “the Act”) vide orders of even date 28.02.2018.
At the outset, the Ld. Counsel for the assessee filed copy of Tribunal order in quantum appeals in these two assessee cases wherein the quantum additions have been deleted including protective addition as well as substantive. The Tribunal in to 1953/Del/2024 and to 1981/Del/2024 vide order dated 14.11.2024 has deleted the additions by para 5, 6, 7 and 8 as under :-
“5. It is this factual backdrop that we proceed to treat Revenue's appeal in as the "lead" case raising twin substantive grounds seeking to revise undisclosed income protective addition of Rs. 4,57,26,000/- and bogus share capital amounting to Rs.28,22,30,000/-; respectively.
We have given our thoughtful consideration to the Revenue's foregoing twin substantive grounds in this "lead" case i.e. and find no merit therein. We make it clear that the learned CIT(A) has not only upheld the substantive additions in case of the main searched person Sh. Ashish Garg, but also concluded in light of section 292C of the Act that going by the statutory presumption of the contents in the incriminating material seized during the course of search, there is no material to uphold the impugned protective addition in the assessee's hands.
So far as Revenue's latter substantive ground regarding share capital addition in the assessee's case is concerned, it has been reversed on the ground that the same already stands assessed in preceding assessment year 2011-12 which has gone un-rebutted from the Revenue side. We thus see no reasons to accept its instant latter substantive grounds being an instance of double addition. This Revenue's "lead" appeal in fails accordingly. Same order to follow in the Revenue's remaining seven appeals seeking to revive identical protective additions which stand rejected in very terms.
To sum up, these Revenue's eight appeals are dismissed in above terms. A copy of this common order be placed in the respective appeals.”
Since quantum addition has been deleted in all these assessment years, the penalties levied u/s 271(1)(c) of the Act will not survive. Hence, we uphold the orders of CIT(A) deleting these penalties. All these appeals are accordingly dismissed.
Order dictated in the open court on conclusion of hearing on 16.12.2024.