SHAW WALLACE DISTILLERIES LTD.,BANGALORE vs. ACIT, BANGALORE

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ITA 810/BANG/2010Status: DisposedITAT Bangalore02 January 2015AY 2003-043 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that since the additions, which formed the basis for the penalty, were deleted by a co-ordinate bench, the penalty order had no basis. Therefore, the penalty order was set aside.

What were the facts?

The Assessing Officer levied penalty under Section 271(1)(c) for disallowances related to irrecoverable debt, excise transport fees, and TDS on sales promoter payments. The assessee appealed the penalty.

What were the issues?

The primary issue was whether penalty under Section 271(1)(c) could sustain when the underlying additions leading to the penalty were deleted by the Tribunal.

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, ‘A’ BENCH : BANGALORE

For Appellant: Shri B.K.Manjunath, CA

This is an appeal filed by the assessee against the order of the CIT(A)-VI, Bangalore, dated 21/04/2010 confirming the penalty levied by the Assessing Officer (AO) u/s 271(1)(c) of the Income-tax Act, 1961[hereinafter referred to as 'the Act'] for the assessment year 2003-04.

M/s.Shaw Wallace Distilleries Ltd. Page 2 of 3 2. At the time of hearing, the learned counsel for the assessee submitted that the AO has levied the penalty on account of : (i) disallowance of write off of irrecoverable debt/advance of Rs.5,22,000/-; (ii) disallowance of claim in respect of Excise transport fees of Rs.1,37,06,961/-and (iii) disallowance of TDS payment made on behalf of sales promoter of Rs.2,28,95,853/-. The learned counsel for the assessee submitted that the appeal against the consequential additions travelled up to the Tribunal and the Tribunal had decided the issues in favour of the assessee and the additions have thus been deleted. He, therefore, submitted that the penalty order does not have any basis to stand. The learned counsel for the assessee has also filed a copy of the order of the Tribunal wherein the additions have been deleted.

3.

Having regard to the rival contentions and the material on record and the decision of the co-ordinate bench of the Tribunal, we find that the additions have been deleted by the Tribunal. Since the very basis for the levy of penalty has been deleted by the Tribunal, we agree with the contentions of the learned counsel for the assessee that the penalty order does not have legs to stand. In view of the same, the penalty order is set aside. M/s.Shaw Wallace Distilleries Ltd. Page 3 of 3 4. In the result, the assessee’s appeal is allowed.

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