M/S SAROVAR ENTERPRISES,PANVEL vs. INCOME TAX OFFICER WARD-2, PANVEL

Although a number of grounds have been raised by the assessee, however, these all relate to the order of CIT(A) / NFAC confirming the penalty of Rs.2,33,750/- levied by the Assessing Officer u/s 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’).

There is a delay of 293 days in filing of this appeal before the Tribunal, for which the assessee has filed a condonation application along with an affidavit explaining the reasons for such delay. After considering the contents of the condonation application filed along with the affidavit and after hearing both the sides, the delay in filing of the appeal by the assessee is condoned and the appeal is admitted for adjudication.

The Ld. Counsel for the assessee at the outset submitted that the Tribunal vide order dated 21.03.2018 has deleted the addition made by the Assessing Officer which is the basis for levy of penalty and therefore, the penalty does not survive. The Ld. Counsel for the assessee accordingly submitted that the penalty levied by the Assessing Officer and confirmed by the CIT(A) / NFAC should be deleted.

The Ld. DR fairly conceded that since the Tribunal has already deleted the addition, therefore, penalty does not survive.

After hearing both the sides, we find the various additions made by the Assessing Officer which are the basis for levy of penalty u/s 271(1)(c) of the Act stands deleted by the Tribunal vide order dated 21.03.2018 for assessment year 2010-11. Since the additions have already been deleted by the Tribunal, therefore, the penalty does not survive. We, therefore, set aside the order of CIT(A) / NFAC and direct the Assessing Officer to cancel the penalty. The grounds raised by the assessee are accordingly allowed.

In the result, the appeal filed by the assessee is allowed.