DCIT 12(2)(1), MUMBAI vs. FIRST FLIGHT COURIERS P.LTD, MUMBAI

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ITA 5400/MUM/2016Status: DisposedITAT Mumbai20 February 2018AY 2010-112 pages

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

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that since the addition/disallowance made in the quantum proceedings was deleted by a Coordinate Bench, the penalty under Section 271(1)(c) could not stand. The basis for the penalty initiation was removed.

What were the facts?

The Revenue appealed against the deletion of penalty levied under Section 271(1)(c) of the Income Tax Act. The penalty was related to an addition/disallowance concerning compensation expenditure.

What were the issues?

Whether penalty under Section 271(1)(c) can be sustained when the underlying addition/disallowance has been deleted by the Tribunal.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, G Bench, Mumbai

Before: Shri C.N. Prasad & Shri A.L. Saini

For Appellant: Shri Abhijeet Patankar
For Respondent: Shri Rajesh Agrawal
Hearing: 20.02.2018Pronounced: 20.02.2018

This appeal has been filed by the Revenue against the order of the CIT(A)-9, Mumbai dated 10.06.2016 for A.Y. 2010-11 in deleting the penalty levied under Section 271(1)(c) of the Income Tax Act, 1961 (hereinafter “the Act”).

2.

At the outset the learned counsel for the assessee submitted that the addition/disallowance made in respect of expenditure claimed on account of compensation payable by the assessee has been deleted by the Coordinate Bench in vide order dated 10.08.2016. Thus the learned counsel submitted that since the addition/disallowance made in the quantum proceedings is deleted by the Tribunal the penalty under Section 271(1)(c) cannot stand. A copy of the order of the Coordinate Bench is placed on record.

M/s. First Flight Couriers P. Ltd. 3. We have perused the order of the Coordinate Bench in dated 10.08.2016 and find that the addition/ disallowance made on account of expenditure claimed towards compensation on damage and loss has been deleted by the Tribunal. In the circumstances the penalty levied under Section 271(1)(c) has no legs to stand as the very basis for initiation of penalty has been deleted by the Tribunal.

4.

In the result, the appeal filed by the Revenue is dismissed.

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