ITO 9(3)(4), MUMBAI vs. GLOWSHINE BUILDERS & DEVELOPERS P.LTD, MUMBAI

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ITA 3391/MUM/2016Status: DisposedITAT Mumbai01 January 2018AY 2009-103 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 made by the AO was deleted in the quantum appeal by the Tribunal and affirmed by the High Court, the penalty order does not survive. Therefore, the appeal of the revenue was dismissed.

What were the facts?

The assessee declared nil income after claiming brought forward loss. The AO made additions on account of short-term capital gain and initiated penalty proceedings. The CIT(A) deleted the penalty, which the revenue appealed.

What were the issues?

Whether penalty under Section 271(1)(c) can be sustained when the addition on which it was based has been deleted in the quantum appeal and affirmed by the High Court.

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, MUMBAI BENCHES “D”, MUMBAI

Before: SHRI SHAMIM YAHYA (AM) & SHRI RAM LAL NEGI (JM)

For Appellant: Ms. Purvi Gupta (AR)
For Respondent: Shri Ram Tiwari (Sr. DR), Ms. Purvi Gupta (AR)
Hearing: 01/01/2018Pronounced: 01/01/2018

O R D E R

PER RAM LAL NEGI, JM

1.

This appeal has been filed by the revenue against the order dated 29.02.2016 passed by the Commissioner of Income Tax (Appeals-16, Mumbai, for the assessment year 2009-10, whereby the Ld. CIT (A) has allowed the appeal filed by the assessee against penalty order passed u/s 271 (1)(c) of the Income Tax Act, 1961 (for short ‘the Act’) and deleted the penalty.

2.

In this case, the appellant company filed its return of income for the assessment year 2009-10 declaring nil income after claiming brought forward loss of Rs. 38,021/-. However, the AO determined the total income at Rs. 15,93,68,479/- by making addition on account of short term capital gain on sale of immovable property and accordingly initiated penalty u/s 271 (1) (c) of the Act for concealment of income. An order u/s 271 (1)(c) of the Act was 2 Assessment Year: 2009-10 accordingly passed imposing penalty of Rs. 3,15,32,720/-. The addition made by AO was confirmed by the CIT (A) in the first appeal. However, the penalty was deleted by the ITAT, Mumbai vide order dated 14.04.2014. The assessee challenged the penalty order before the CIT (A). The CIT (A) allowed the appeal and deleted the penalty on the ground that in quantum appeal, the ITAT has deleted the addition sustained by the Ld. CIT (A). The revenue is in appeal against the said order by raising the following ground.

Whether on the facts and in circumstances of the case, the Ld. CIT (A) erred in deleting the penalty levied u/s 271 (1)(c) whereas the AO rightly treated the short term capital gain on sale of development rights in the year of the transaction?

3.

At the very outset, the Ld. counsel for the assessee submitted that since the Tribunal has deleted the addition in quantum appeal and the order of the Tribunal has been affirmed by the Hon’ble High Court of Bombay in ITA No 1756 of, the penalty order does not survive. Therefore, the appeal of the revenue is liable to be dismissed.

4.

The Ld. Departmental Representative (DR) did not controvert the facts submitted by the Ld. counsel for the assessee.

5.

We have carefully perused the orders passed by the authorities below as well as the order passed by the co-ordinate Bench and the order of the Hon’ble High Court. The coordinate Bench of the Tribunal has deleted the addition sustained by the CIT (A) in vide order dated 11.04.2014. The appeal against the findings of the coordinate Bench aforesaid has been affirmed by the Hon’ble High Court of Bombay in Income Tax Appeal No. 1756 of 2014 dated 09.04.2017. Under these circumstances, the impugned penalty order does not survive in this case. We accordingly uphold the findings of the Ld. CIT(A) and dismiss the sole ground of appeal of the revenue .

3 Assessment Year: 2009-10 In the result, appeal filed by the revenue for assessment year 2009-2010 is dismissed.

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