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Facts
The assessee appealed against a penalty order for AY 2006-07. The Ld. Counsel submitted that the addition made by the AO, which led to the penalty, had already been deleted by the Tribunal in a quantum appeal (ITA No.349/Del/2010) for the same assessment year, a fact undisputed by the Ld. DR.
Held
The Tribunal, noting that the underlying addition in the quantum appeal was deleted, concluded that the consequential penalty order could not stand. Accordingly, the impugned penalty order and the order of the Ld. CIT(A) were set aside.
Key Issues
Whether a penalty order is valid when the underlying addition in the quantum assessment has been deleted by the Tribunal.
Sections Cited
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Income Tax Appellate Tribunal, DELHI BENCH ‘F’: NEW DELHI
Date of Hearing 17/01/2024 Date of Pronouncement 19/01/2024 ORDER
PER YOGESH KUMAR U.S., JM:
This appeal filed by the Assessee against the order of Learned Commissioner of Income Tax (Appeals), Rohtak, [“Ld. CIT(A)”, for short], dated 05/08/2020 for Assessment Year 2006-07.
The Ld. Counsel for the assessee submitted that addition made by the AO has been deleted by the Tribunal in the quantum appeal in for A.Y.2006-07, therefore, the M/s. Prakash Industries Ltd. vs. ACIT penalty proceedings initiated pursuant to the additions made in the assessment is liable to be set aside. The Ld. Counsel for the assessee has also produced the order of the Co-ordinate Bench dated 05/01/2024 in ITA No.349/Del/2010. The Ld. DR has not disputed the above facts.
Considering the fact that the Co-ordinate Bench vide order dated 05/01/2024 in deleted the addition in the quantum appeal, the consequential penalty order is also liable to be quashed. Accordingly, the appeal is allowed and the impugned penalty order and the order of the Ld. CIT(A) are hereby set aside.
In the result, the appeal filed by the assessee is allowed.
Order pronounced in open Court on 19th January, 2024.