SARANG & ASSOCIATES,MUMBAI vs. DCIT CEN CIR 36, MUMBAI

PDF · subscribers
ITA 1958/MUM/2015Status: DisposedITAT Mumbai14 June 2018AY 2007-083 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 quashed the penalty orders for AY 2007-08 and 2008-09 as the assessment orders were quashed. For AY 2009-10, penalties related to deleted additions were also quashed, and the penalty on a restored addition was also set aside.

What were the facts?

The assessee challenged penalty orders under Section 271(1)(c) for assessment years 2007-08 to 2009-10. The quantum assessment orders for these years had been subject to prior Tribunal rulings.

What were the issues?

Whether penalties under Section 271(1)(c) can survive when the underlying assessment orders are quashed or additions are deleted/restored. The impact of prior Tribunal decisions on quantum proceedings on penalty proceedings.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 69,Section 69C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “E” Bench, Mumbai

Before: Shri B.R. Baskaran (AM)& Shri Pawan Singh (JM)

For Appellant: Shri N.P. Chhajed
For Respondent: Shri V. Justin
Hearing: 14.06.2018Pronounced: 14.06.2018

Heard together (3 matters)

I.T.A. No. 1958/Mum/2015
I.T.A. No. 1959/Mum/2015
I.T.A. No. 1960/Mum/2015

Read from the judgment's own cause title. This page is filed under one of them.

O R D E R Per B.R. Baskaran (AM) :-

All these appeals filed by the assessee are directed against the orders passed by Ld CIT(A)-53, Mumbai and they relate to the assessment years 2007-08 to 2009-10. In all these appeals, the assessee is challenging the orders passed by Ld CIT(A) confirming the penalty levied u/s 271(1)(c) of the Act.

2.

We heard the parties and perused the record. The Ld A.R submitted that the Tribunal has passed the orders in quantum proceedings in all the three years under consideration, vide its order dated 21-03-2018 passed in to 1229/Mum/2012 relating to AY 2007-08 to 2009-10. He submitted that the Tribunal has quashed the assessment order passed for AY 2007-08 and 2008-09. He submitted that the Tribunal has deleted two additions in AY 2009-10 and restored one addition to the file of the AO in AY 2009-10. Accordingly the Ld A.R submitted that these three penalty orders shall not survive in view of the common order passed by the Tribunal in the quantum assessment proceedings.

2 M/s. Sarang & Associates

3.

We heard Ld D.R and he did not controvert the submissions made by Ld A.R.

4.

We have gone through the order dated 21.03.2018 (referred supra) passed by the co-ordinate bench of Tribunal in the quantum assessment proceedings. In paragraph 12 of the order, the Tribunal has quashed the assessment framed for AY 2007-08 and in paragraph 18 of the order, the Tribunal has quashed the assessment framed for AY 2008-09. Since the assessment order itself has been quashed for these two years, the relevant penalty orders shall not have independent legs to stand on its own. Accordingly we quash the orders passed by the tax authorities for AY 2007-08 and 2008-09.

5.

In assessment year 2009-10, the penalty u/s 271(1)(c) of the Act was levied on the following additions:- (a) Addition u/s 69 of the Act - Rs.31.00 lakhs (b) Addition of cash shortage - Rs. 1.25 lakhs (c) Addition u/s 69C of the Act - Rs.10.00 lakhs

6.

We notice that the Tribunal has deleted the addition of Rs.31.00 lakhs and the addition of Rs.1,25 lakhs, vide paragraph numbers 30 and 32 of the order. Hence the penalty levied on these two amounts is liable to be deleted. With regard to the amount of Rs.10.00 lakhs, we notice that the Tribunal has restored the same to the file of the AO, vide paragraph 33 of its order. Accordingly the penalty levied on the above said amount also shall not survive. We order accordingly. However, the AO may initiate penalty proceedings in the set aside proceeds, if he is satisfied so.

7.

In the result, all the three appeals of the assessee are allowed. Order has been pronounced in the Court on 14.6.2018.

More judgments on Section 271(1)(c)

All 25,141 judgments and leading authorities on Section 271(1)(c) →

Recent GST High Court judgments

Search GST case law →