DCIT CENT. CIR. 4(2), CENT. RANGE - 4, MUMBAI vs. RED CHILLIES ENTERTAINMENT PVT. LTD., MUMBAI

Aforesaid appeal by revenue for Assessment Year [AY] 2009-10 contest the order of the Ld. Commissioner of Income-Tax (Appeals)-52 [CIT(A)], Mumbai, Appeal No.CIT(A)-52/IT/DC-CC-4(2)/158/2013-14 dated 28/01/2016 qua deletion of penalty u/s 271(1)(c) for Rs.87.89 Lacs. The assessment for impugned AY was framed by Ld. Assistant Red Chillies Entertainment Private Limited Assessment Year-2009-10 Commissioner of Income Tax-29, Mumbai [AO] u/s 143(3) wherein the assessee was saddled with certain disallowances. Consequently, penalty proceedings u/s 271(1)(c) were initiated in the quantum assessment order and the assessee has been saddled with impugned penalty of Rs.87.89 Lacs vide order dated 27/08/2013. The same has been levied on account of additions of Rs.239.39 Lacs under Rule 9A and another addition of Rs.19.19 Lacs, being loss from abandoned projects as claimed by the assessee during impugned AY.

The Ld. CIT(A), vide impugned order dated 28/01/2016, after considering the factual matrix has deleted the impugned penalty on merits, against which the revenue is in further appeal before us.

The Ld. Auhtorized Representative for assessee [AR], Shri Hiro Rai, at the outset, drew our attention to the fact that the assessee has successfully contested both the additions before this Tribunal vide order dated 31/05/2016 and therefore the penalty under question do not survive. A copy of the cited order has been placed on record. The same was controverted by Ld. Departmental Representative [DR], Shri Ram Tiwari by submitting that the revenue has not accepted the above decision and therefore, the quantum additions have not finality.

We have carefully heard the rival contentions and perused relevant material on record. It is undisputed fact that both the additions against which the penalty has been levied has been deleted by the Tribunal and there is nothing on record to suggest that the aforesaid decision has been stayed / reversed, in any manner, by any higher judicial authorities. Therefore, as of now, the impugned penalty could not be sustained and Red Chillies Entertainment Private Limited Assessment Year-2009-10 we see no reason to interfere with the order of Ld. first appellate authority, in this regard. 5. Resultantly, the revenue’s appeal stand dismissed. Order pronounced in the open court on 20th July, 2018