JAI SINGH GOEL,NEW DELHI vs. ACIT, NEW DELHI

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ITA 202/DEL/2024Status: DisposedITAT Delhi14 November 2024AY 2014-15Bench: SHRI SATBEER SINGH GODARA (Judicial Member)3 pages

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Facts

The assessee appealed against three CIT(A) orders imposing penalties under Section 271(1)(c) of the Income Tax Act for assessment years 2012-13 to 2014-15. These penalties, totaling Rs. 1,42,975/-, Rs. 55,913/-, and Rs. 64,161/-, were levied for alleged concealment and inaccurate particulars related to estimated rental receipts and cost of acquisition, following a search action on the SRM group. The Revenue contended these penalties represented undisclosed income and should be upheld.

Held

The Tribunal deleted all three penalties, finding no reason to sustain them. It observed that the penalties were levied solely under Section 271(1)(c) and not based on seized material from the search, distinguishing it from Section 271AAB. Citing *CIT v. Reliance Petroproducts Pvt. Ltd. (2010) 322 ITR 158 (SC)*, the Tribunal emphasized that quantum additions do not automatically attract penalties, and parallel proceedings require independent justification.

Key Issues

Whether penalties levied under Section 271(1)(c) for alleged concealment of income and furnishing inaccurate particulars were justified when not based on seized material from a search action, and if quantum additions automatically warrant penalties.

Sections Cited

Section 271(1)(c) of the Income-tax Act, 1961, Section 271AAB of the Income-tax Act, 1961

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “SMC”: NEW DELHI

Before: SHRI SATBEER SINGH GODARA

For Respondent: Shri Yogesh Sharma, Sr. DR

Hearing: 07.11.2024Pronounced: 14.11.2024

O R D E R PER SATBEER SINGH GODARA, JM:

These assessee’s three appeals in to 202/Del/2024 for assessment years 2012-13 to 2014-15 arise against learned CIT(Appeals)-29, Delhi’s as many orders; all dated 29.11.2023; in appeal nos. CIT(A), Delhi- 29/10002/2019-20; CIT(A), Delhi-29/10010/2019-20; and CIT(A), Delhi- 29/10012/2019-20 respectively, in proceedings u/s 271(1)(c) of the Income-tax Act, 1961, hereinafter referred to as the “Act”.

Cases called twice. None appears at the assessee’s behest. He is accordingly proceeded ex parte. and Revenue’s vehement contentions that both the learned lower authorities have levied the impugned section 271(1)(c) penalties of Rs. 1,42,975/-, Rs. 55,913/-; and Rs. 64,161/-; assessment year wise respectively, on the ground that the assessee had concealed and furnished inaccurate particulars of income representing estimated rental receipts with cost of acquisition (in the first and foremost year followed by similar heads, after department’s search action conducted on M/s SRM group of cases on 15.10.2013.

The Revenue’s vehement contention is that all the impugned penalties represent the assessee’s undisclosed income and therefore, they deserve to be upheld.

I have considered the relevant facts in the case files as well as rival pleas and find no reason to sustain the impugned penalties qua quantum additions of estimated rental income and disallowance of cost of acquisition, as the case may be. It is made clear that Section 271AAB of the Act is special provision dealing with such a penalty arising from detection of undisclosed income in the course of search action on or after 1.7.2012 but before 2016. It is an admitted factual position that both the learned lower authorities have levied penalty in assessee’s hands u/s 271(1)(c) of the Act only and, therefore, the same is not based on any seized material in the course of search. That being the case and going by their lordships landmark decision in CIT v. Reliance Petroproducts Pvt. Ltd. 2010) 322 ITR 158 (SC) that quantum and penalty proceedings are parallel proceedings wherein each and every addition/disallowance made in the course of former does not ipso facto attract the latter penalty provision, I delete all the three impugned penalties in the impugned as many assessment years forming subject matter of adjudication. The assessee succeeds in identical substantive grounds in the instant appeals therefore.