TARUNA VATSSA,AGRA vs. INCOME TAX OFFICER, AGRA

This appeal has been preferred by assessee against the impugned order dated 17.12.2024 passed in Appeals No.NFAC/2012-13/10299719 by the Ld. Commissioner of Income-tax (Appeals), NFAC, Delhi u/s. 250(6) of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) wherein the ld. CIT(Appeals), confirmed the penalty levied by the Assessing Officer amounting to Rs.40,01,200/- u/s. 271(1)(c) of the Act.

We have perused the records and heard the ld. Representative for the assessee and the ld. Departmental representative for the Revenue.

Learned representative for the assessee has submitted at the outset that the assessment order, on which the impugned penalty is based, has been set aside by the Tribunal in assessee’s quantum appeal No. 317/Agr/2024 vide order dated 07.02.2025, remanding the matter back to the Assessing Officer. Therefore, the very foundation of penalty no longer exists in the present case.

Learned DR has supported the orders of the authorities below.

Keeping in view the aforesaid uncontroverted contention of the ld. Representative for the assessee, we are of the opinion that once the impugned additions, on the basis of which penalty u/s. 271(1)(c) of the Act was levied, have been set aside, restoring the matter back to the Assessing Officer by the Tribunal vide order dated 07.02.2025 in assessee’s quantum appeal for re-consideration, the very basis for imposition of impugned penalty stands collapsed. Accordingly, there is no justification to sustain the penalty at this stage. The appeal of the assessee deserves to be allowed.