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Income Tax Appellate Tribunal, DELHI BENCH: ‘E’ : NEW DELHI
Before: SHRI CHANDRA MOHAN GARG, & SHRI L.P. SAHU,
PER CHANDRA MOHAN GARG, JUDICIAL MEMBER
This appeal filed by the assessee is directed against the order of the CIT(A)-LTU, New Delhi, dated 10/10/2012 for A.Y 2004-05.
The only ground raised in this appeal by the assessee relates to the upholding of the penalty u/s 271(1)(c) of the Income-tax Act, 1961 [hereinafter referred to as ‘the Act’] by the ld. CIT(A).
At the very outset of the opening of the arguments, the ld. AR referred to the decision of the Hon'ble High Court of Delhi in the case of the very assessee itself in dated 15th September, 2105 wherein at para No. 24, the Hon'ble High Court has set aside the order passed by the Tribunal by allowing the appeal of the assessee. In view of the said decision, the ld. AR prayed that the penalty levied by the AO and sustained by the ld. CIT(A) may be cancelled.
On the other hand, the ld. DR supported the orders of the authorities below.
We have heard the rival submissions and have perused the relevant material on record. We find that the basis of levy of penalty in this case is the Tribunal order in the quantum appeal. Since the penalty was levied on the basis of the order of the Tribunal dated 20.07.2011 which the Hon'ble High Court in the case of the assessee itself [supra] has set aside vide para 24 order dated 15.09.2015, the penalty does not survive and the 2
same is hereby cancelled. Para 24 of the order of the Hon'ble High Court is reproduced hereinbelow for ready reference:
“In view of the aforesaid, we find considerable merit in the contention of the assessee that the AO did not have the jurisdiction to tax the profits and gains from sale/realization of investments u/s 147 of the Act. The first and the third questions of law are therefore, answered in favour of the assessee and against the revenue. In view of our decision that the AO could not assume jurisdiction to reopen the assessment u/s 147 of the Act, it is not necessary to address and the second question of law, which relates to the taxability of profits on sale of investments on merits.”
In view of the above, the grounds raised by the assessee stand allowed by deleting the penalty levied by the AO and confirmed by the ld. CIT(A).
In the result, the appeal of the assessee is allowed.