DINESH CHAND SHARMA,GHAZIABAD vs. ITO WARD 3(4), NEW DELHI

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ITA 2113/DEL/2019Status: HeardITAT Delhi12 January 2022AY 2008-093 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 reassessment order, which formed the basis for the penalty, had been quashed by a previous order of the Tribunal. Therefore, the penalty could not survive.

What were the facts?

The assessee's appeal was against a penalty levied under Section 271(1)(c) of the Income Tax Act. The penalty was based on an addition made in a reassessment order.

What were the issues?

Whether a penalty under Section 271(1)(c) can be sustained when the reassessment order forming the basis of the addition has been quashed.

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, DELHI “B” BENCH: NEW DELHI

Before: SHRI ANIL CHATURVEDI & SHRI C. N. PRASAD

Hearing: 12.01.2022Pronounced: 12.01.2022

PER C. N. PRASAD, JM :

1.

This appeal is filed by the assessee against the order of the Ld. CIT(A)-Ghaziabad, dated 31.12.2018 for the assessment year 2008- 09 in sustaining the penalty levied U/s 271(1)(c) of the Act by the Assessing Officer.

2.

At the outset, the Ld. Counsel for the assessee submits that the quantum addition made in reassessment order passed u/s 143(3)/147 of the Act has been deleted by the Tribunal by order

3.

We have heard rival submissions and perused the order of the Tribunal in dated 04.03.2020. We observed that the Tribunal quashed the reassessment order dated 28.10.2015 passed u/s 143(3) r.w.s 147 of the Act in which an addition of Rs.1,50,000/- was made as unexplained cash deposit in to the bank account of the assessee. The Assessing Officer levied penalty U/s 271(1)(c) of the Act on the addition of Rs.1,50,000/- made the reassessment order. However, since the reassessment order has been quashed by the Tribunal by order dated 04.03.2020 in ITA No.5234/Del/2016 the very basis of addition for levy of penalty no longer exists. Therefore, once the very basis of addition is no longer in existence the penalty order will not survive on its own. In the circumstances, we direct the assessing officer to delete the penalty levied U/s 271(1)(c) of the Act for the assessment year under consideration. Grounds raised by the Assessee are allowed.

4.

In the result, appeal of the assessee is allowed.

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