HIKAL LTD,MUMBAI vs. DCIT CIR 3(1), MUMBAI

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ITA 220/MUM/2014Status: DisposedITAT Mumbai09 March 2016AY 2002-032 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 reopening of the assessment itself was previously held to be invalid by another Tribunal order. Consequently, the basis for the penalty no longer existed.

What were the facts?

The assessee appealed against a penalty levied under Section 271(1)(c) for the assessment year 2002-03. The penalty was based on additions made pursuant to the reopening of the assessment.

What were the issues?

Whether a penalty under Section 271(1)(c) can be sustained when the underlying additions, made pursuant to a reopened assessment, have been set aside due to invalid reopening.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “H”, MUMBAI

Before: SHRI SANJAY GARG & SHRI RAJESH KUMAR

For Appellant: Shri Sanjay Parikh, A.R
For Respondent: Shri E. Sridhar, D.R
Hearing: 04.04.2016Pronounced: 04.04.2016

Per Sanjay Garg, Judicial Member:

1.

The present appeal has been preferred by the assessee against the order dated 14.10.2013 of the Commissioner of Income Tax (Appeals) [hereinafter referred to as the CIT(A)] relevant to assessment year 2002-03 agitating the confirmation of the penalty levied under section 271(1)(c) of the Act.

2.

At the outset, the Ld. A.R. of the assessee has stated that the quantum additions in respect of which the penalty in question was levied by the Assessing Officer (hereinafter referred to as the AO) have been made pursuant to the reopening of the assessment. He has further invited our attention to the order of the Tribunal dated 17.02.16 passed in relevant to A.Y. 2002-03 vide which the very reopening of the assessment has been held to be invalid and the consequential additions made pursuant to reopening have been set aside. 2 M/s. Hikal Ltd.

3.

In view of this, the very base upon which the penalty in this case was levied has ceased to exist, hence, the consequent penalty has no legs to stand and the same is accordingly ordered to be deleted.

4.

In the result, the appeal of the assessee is hereby allowed.

Order pronounced in the open court on 04.04.2016.

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