HIKAL LTD,MUMBAI vs. DCIT CIR 3(1), MUMBAI

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ITA 1150/MUM/2016Status: DisposedITAT Mumbai24 January 2018AY 2003-042 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 noted that the quantum appeal, which formed the basis for the penalty, had been decided in favor of the assessee. The assessment order was declared invalid and quashed.

What were the facts?

The assessee appealed against a penalty imposed under Section 271(1)(c) for concealment of income. The penalty was confirmed by the CIT(A).

What were the issues?

Whether a penalty under Section 271(1)(c) can survive if the underlying assessment order is quashed. The validity of reassessment proceedings under Section 147.

Which sections of the Income-tax Act were involved?

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

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, H Bench, Mumbai

Before: Shri D.T. Garasia & Shri Rajesh Kumar

For Appellant: Shri Sanjay R. Parikh
For Respondent: Shri M.C. Omi Ningshen
Hearing: 01.01.2018Pronounced: 24.01.2018

This appeal has been filed by the assessee against the order of the CIT(A)-8, Mumbai dated 31.12.2015 for A.Y. 2003-04.

2.

The only issue raised by the assessee in this appeal is against the confirmation of penalty of `37,68,299/- by the CIT(A) as imposed by the AO under Section 271(1)(c) of the Income Tax Act, 1961 (hereinafter “the Act”) for concealment of income.

3.

At the outset the learned A.R. for the assessee pointed out that the quantum appeal in connection with which this penalty has been levied stands decided in favour of the assessee by the order dated 17.02.2016 passed in for A.Y. 2003-04 by the coordinate bench wherein the assessment order passed u/s 143(3) r.w.s. 147 of the Act has been declared invalid and quashed. The learned A.R. submitted that since the assessment order has been quashed, the penalty, which is M/s. Hikal Limited the subject matter of the present appeal, has no legs to stand and therefore the penalty be deleted.

4.

The learned D.R. fairly agreed with the contention and the arguments of the learned A.R.

5.

We have heard the rival submissions and perused the material on record. We find that the quantum appeal has been decided by the order of the Coordinate Bench in for A.Y. 2003-04 wherein the reassessment proceedings under Section 147 has been declared to be invalid and therefore in view of the said order, the penalty levied by the AO and sustained by the CIT(A) is ordered to be deleted.

6.

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

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