ITO, NEW DELHI vs. M/S. MAHAVIR CONCAST LTD., NEW DELHI

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ITA 4189/DEL/2014Status: DisposedITAT Delhi30 September 2015AY 2007-083 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 addition of interest, which formed the basis for the penalty, was deleted in quantum proceedings, there was no justification for confirming the penalty. Therefore, the impugned order deleting the penalty was upheld.

What were the facts?

The Revenue appealed against the CIT(A)'s order confirming a penalty imposed under Section 271(1)(c) for the assessment year 2007-08. The penalty was based on an addition of Rs. 12,10,000 made by the AO for disallowance of interest.

What were the issues?

Whether penalty under Section 271(1)(c) can be sustained when the addition forming the basis of the penalty has been deleted.

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, DELHI BENCHES : SMC-I : NEW DELHI

Before: SHRI R.S. SYAL

For Appellant: Shri Rajesh Kumar Jain, CA
For Respondent: Shri S.L. Anuragi, Sr. DR
Pronounced: 30.09.2015

ORDER This appeal by the Revenue arises out of the order passed by the CIT(A) on 23.5.2014 confirming penalty of Rs.4,07,286/- imposed by the AO u/s 271(1)(c) of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) in relation to the assessment year 2007-08.

2.

I have heard the rival submissions and perused the relevant material on record. It is observed that the sole basis for imposition of penalty u/s 271(1)(c) is the addition of Rs.12,10,000/- made by the AO on account of disallowance of interest. This addition has been finally deleted by the Tribunal in quantum proceedings vide its order dated 17.4.2014 in CO No.290/Del/2011. In view of the fact that the very bedrock of penalty, being the addition of interest has been deleted, there remains no occasion for confirming any penalty. I, therefore, uphold impugned order in deleting the penalty.

3.

In the result, the appeal is dismissed.

The order pronounced in the open court on 30.09.2015.

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