M/S. CHOPRA MARKETING PVT. LTD.,NEW DELHI vs. DCIT, NEW DELHI

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ITA 6186/DEL/2015Status: DisposedITAT Delhi21 November 2017AY 2006-073 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal found that the initiation of reassessment proceedings was invalid. Since the assessment order, which was the basis for the penalty, no longer exists, the penalty cannot be sustained.

What were the facts?

The assessee's appeal challenges a penalty imposed under Section 271(1)(c) of the Income-tax Act. The penalty stemmed from an assessment order passed pursuant to a reassessment notice.

What were the issues?

The primary issue was the validity of the reassessment proceedings and whether a penalty could be imposed when the underlying assessment order was found to be invalid.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 148,Section 143(3),Section 147

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCHES : F : NEW DELHI

Before: SHRI R.S. SYAL & SMT BEENA PILLAI

For Appellant: Shri Chandra Shekhar, CA
For Respondent: Shri Atiq Ahmad, Sr. DR
Hearing: 20.11.2017Pronounced: 21.11.2017

Date of Hearing : 20.11.2017 Date of Pronouncement : 21.11.2017 ORDER PER R.S. SYAL, VP: This appeal by the assessee is directed against the order passed by the CIT(A) on 31.08.2015 upholding the penalty of Rs.42,07,500/- imposed by the Assessing Officer u/s 271(1)(c) of the Income-tax Act, 1961 (hereinafter also called ‘the Act’).

2.

We have heard both the sides and perused the relevant material on record. The penalty proceedings arose out of assessment order passed by the Assessing Officer pursuant to notice u/s 148. Such assessment order was challenged in appeal. The Tribunal, vide its order dated 28.12.2016, has held the initiation of reassessment proceedings as invalid. A copy of such order in for assessment year 2006-07 has been placed on record. Nothing has been brought on record to demonstrate that such order passed by the Tribunal has been set aside or modified in any manner by the Hon'ble High Court. Since the very foundation of the penalty proceedings, being the assessment order passed u/s 143(3) read with section 147 ceases to exist, there can be no question of any penalty flowing therefrom. We, therefore, set aside the impugned order and order for the deletion of the penalty.

3.

In the result, the appeal filed by the assessee is allowed.

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