ITO (EXEMPTIONS), NEW DELHI vs. M/S. YOUNG WOMEN'S CHRISTIAN ASSOCIATION OF DELHI, NEW DELHI

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ITA 3275/DEL/2016Status: DisposedITAT Delhi26 February 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 additions in the quantum proceedings were deleted and the order attained finality up to the High Court, no penalty under Section 271(1)(c) is leviable. The CIT(A)'s order deleting the penalty was affirmed.

What were the facts?

The Assessing Officer (AO) denied exemption under Section 11 to the assessee, holding its activities to be non-charitable. Consequently, a penalty under Section 271(1)(c) was levied. However, the quantum proceedings were decided in favour of the assessee.

What were the issues?

Whether penalty under Section 271(1)(c) can be sustained when the underlying additions in quantum proceedings have been deleted and the matter has attained finality.

Which sections of the Income-tax Act were involved?

Section 11,Section 2(15),Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “C”: NEW DELHI

Before: SHRI AMIT SHUKLA & SHRI PRASHANT MAHARISHI

For Appellant: Shri A.T. Panda Advocate, Ms. Gargi Sethi, Advocate
For Respondent: Shri Amit Jain, Sr. DR, Shri A.T. Panda Advocate, Ms. Gargi Sethi, Advocate
Hearing: 26/02/2018

O R D E R PER AMIT SHUKLA, J.M.

The aforesaid appeal has been filed by the revenue dated 17.3.2016, passed by the Ld. CIT (Appeals)-36, New Delhi in relation to the penalty proceedings u/s 271(1)(c) for the assessment year 2009-

10.

The revenue is mainly aggrieved by the deletion of penalty of Rs. 68,44,237/- made by the AO after denying the exemption u/s 11 on the ground that assessee’s activities are non charitable in nature in terms of proviso to section 2(15).

ITO vs. Young Women’s Christian Association of Delhi

2.

Before us, Ld. Counsel for the assessee submitted that in the quantum proceedings, the matter has been decided in favour of the assessee, by the Tribunal in ITA 1019/Del/2013 (order dated 15.2.2016), wherein the assessee has been granted exemption u/s 11 by holding that assessee’s activities fall within the definition of “charitable purposes” u/s 2(15). Ld. Counsel further pointed out that the said Tribunal order has been affirmed by the Hon’ble High Court in vide judgment dated 2.8.2016. Thus, penalty levied u/s 271(1)(c) has no legs to stand. Ld. DR also admitted that in the quantum proceedings the additions stand deleted and therefore, penalty levied by the AO cannot be sustained.

3.

After considering the aforesaid fact that, when the addition itself stands deleted in the quantum proceedings and such an order has attained finality from the stage of the Hon’ble High Court, then no penalty u/s 271(1)(c) is leviable. Accordingly, order of the Ld. CIT (A) deleting the said penalty is affirmed.

4.

In the result appeal of the assessee is dismissed.

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