DCIT, NEW DELHI vs. M/S ANSAL LANDMARK TOWNSHIPS (P) LTD., NEW DELHI
What did the Tribunal hold?
The Tribunal held that since the quantum addition was set aside for verification, the penalty also needs to be sent back to the AO to be decided in conformity with the quantum appeal.
What were the facts?
The Assessing Officer levied penalties for disallowances under Section 40(a)(ia). The ITAT had previously set aside the quantum addition to the AO for verification of payee's tax compliance.
What were the issues?
Whether penalty can be sustained when the underlying addition has been set aside for verification of facts.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCHES: ‘F’, NEW DELHI
ORDER
PER BEENA A PILLAI, JUDICIAL MEMBER
The present penalty appeals have been preferred by revenue against order dated 07/04/15 passed by Ld. CIT(A)-1, New Delhi for assessment years 2008-09 and 2009-10 on the following grounds of appeal:
1. On the facts and in the circumstances of the case, the Ld.CIT(A) has erred on facts and in law in deleting the penalty, whereas the addition had been confirmed by Ld.CIT(A).
2. The appellant craves leave for reserving the right to amend, modify, alter, add or forego any grounds of appeal at any time before or during the hearing of this appeal.
1. On the facts and in the circumstances of the case, the Ld.CIT(A) has erred on facts and in law in deleting the penalty, whereas the addition had been confirmed by Ld.CIT(A).
The appellant craves leave for reserving the right to amend, modify, alter, add or forego any grounds of appeal at any time before or during the hearing of this appeal
Brief facts of the case are as under: Assessing Officer levied a penalty of Rs.1,81,00,000/-and Rs.1,62,00,000/- for disallowance of Rs.5,30,96,607/-and Rs.4,76,30,766/- under section 40 (a) (ia) of the Act for assessment years under consideration respectively. It has been submitted that the additions were upheld by Ld. CIT (A)-4, 2 New Delhi vide order dated 13/03/12 and 01/11/12 respectively. The assessee thereafter appealed before this Tribunal. Tribunal vide order dated 21/07/14 in and 877/Del/2013 for assessment years 2008-09 and 2009- 10, set aside the issue to the file of Ld. AO for limited purposes of verification. This Tribunal directed that assessing officer to verify whether, payee has filed his return of income and paid of the taxes within stipulated time and if the compliance has been done by the payee, no disallowance shall be made in the hands of the assessee. 3.1. Ld. DR placed his reliance upon the orders of the authorities below. 3.2. Ld.AR placed his reliance upon the relevant findings in the order passed by this Tribunal in assessee’s own case for the assessment years 2008-09 and 2009-10 in ITA no.2859/Del/12 and 817/Del/13 vide order dt. 21.7.2014.
We have perused the submissions advanced by both the sides in the light of decision of this Tribunal in assessee’s own case for the years under consideration. This Tribunal held as under. “13. Respectfully following the same, we set aside the issue to the file of AO for the limited purpose of verification. The AO shall verify whether payee has filed his return of income and paid of the taxes within stipulated time. If it has done so no disallowance shall be made.”
In our considered opinion, as this Tribunal in the quantum appeal has set aside the issue to the file of the AO for due verification of certain facts. Under such circumstances, the penalty also needs to be sent back to the Ld. AO to decide in conformity with the quantum appeal. 6. In lieu of the above discussion the appeals filed by the revenue for Assessment Year 2008-09 and 2009-10 stand allowed for statistical purposes. Order pronounced in the open court on 22nd November, 2017.
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