DEPUTY COMMISSIONER OF INCOME TAX, MUMBAI vs. SINDOOR VINEET MITTAL, MUMBAI
Facts
The Revenue preferred these appeals against the order of the Ld. Commissioner deleting the penalty. The Assessing Officer had made additions of Rs.7,14,99,827/- on account of unexplained credit and expenditure. The Ld. CIT(A) confirmed these additions, but the penalty imposed was deleted by the Ld. Commissioner.
Held
The Tribunal noted that a co-ordinate Bench had already allowed the assessee's appeal and deleted the primary additions. Since the foundation for imposing the penalty had collapsed, the penalty could not survive.
Key Issues
Whether the penalty imposed under section 271(1)(c) can survive when the primary additions on which it was based have been deleted by a higher appellate authority?
Sections Cited
68, 69A, 69C, 271(1)(c), 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, MUMBAI BENCH “G”, MUMBAI
Before: SHRI NARENDER KUMAR CHOUDHRY & SHRI RATNESH NANDAN SAHAY
Per : Narender Kumar Choudhry, Judicial Member:
The issues involved in both the appeals are identical and therefore for the sake of brevity the same were heard together and are being disposed of by this composite order and considering ITA No.3380/M/2024 as a lead case and result of the same shall apply mutatis mutandis to both the appeals under consideration.
These appeals have been preferred by the Revenue against the order even dated 01-05-2024 impugned herein, passed by the Ld. Commissioner of Income Tax (Appeals) (in short Ld. Commissioner) under section 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y. 2015-16.
2 ITA Nos.3380 & 3376/M/2024 Ms. Sindoor Vineet Mittal
Both the cases are based on the almost identical facts and circumstances except variation in figures, therefore for the sake of brevity the same were heard together and are being disposed of by this order and considering the ITA No.3380/M/2024 as a lead case and the result of the same shall apply mutatis mutandis to the connected appeal as well.
Coming to the ITA No.3380/M/2024, we observe as submitted by both the parties that in the instant case vide assessment order dated 28.12.2019, the addition of Rs.7,14,99,827/- in total (Rs.6,94,17,308/- on account of unexplained credit u/s 68 of the Act Rs.20,82,519/- on account of unexplained expenditure u/s 69A of the Act was made, by the Assessing Officer (AO).
The Assessee, being aggrieved, challenged the aforesaid addition by filing first quantum appeal before the then Ld. CIT(A) who vide order dated 29.11.2021 has confirmed the aforesaid addition. Thereafter vide order dated 27.03.2023 a penalty order u/s 271(1)(c) of the Act was passed, whereby the penalty of Rs.2,87,25,000/- @ 100% of the tax sought to be evaded on the income of Rs.7,14,99,827/- has been made. On appeal, Ld. Commissioner deleted the penalty.
During the hearing, the Assessee has drawn our attention to the Tribunal’s order dated 17.11.2023, whereby the co-ordinate Bench of the Tribunal allowed the appeal of the Assessee and consequently deleted the addition of Rs.7,14,99,827/- in total {additions of Rs.6,94,17,308/-, Rs.20,82,519/- respectively made u/s 68 & 69C of the Act}. As the foundation of the imposing the penalty has already been collapsed by virtue of Tribunal’s order dated 17.11.2023 referred to above, hence the penalty under consideration could not survive and therefore the same has rightly been deleted by the Ld. Commissioner by passing impugned order. Thus, the appeal under consideration is liable to be dismissed.
3 ITA Nos.3380 & 3376/M/2024 Ms. Sindoor Vineet Mittal
The Ld. DR did not refute the aforesaid facts and claim of the Assessee.
Considering the peculiar facts and circumstances referred to above in totality, the appeal under consideration i.e. ITA No.3380/M/2024 filed by the Revenue Department is dismissed.
In view of our decision in ITA No.3380/M/2024, both the appeals under consideration stands dismissed.
Order pronounced in the open court on 30.08.2024.
Sd/- Sd/- (RATNESH NANDAN SAHAY) (NARENDER KUMAR CHOUDHRY) ACCOUNTANT MEMBER JUDICIAL MEMBER
* Kishore, Sr. P.S.
Copy to: The Appellant The Respondent The CIT, Concerned, Mumbai The DR Concerned Bench
//True Copy//
By Order
Dy/Asstt. Registrar, ITAT, Mumbai.
