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Income Tax Appellate Tribunal, “SMC” BENCH, AHMEDABAD
Before: & SHRI NARENDRA PRASAD SINHA
Shrenik Hiralal Shah The Income Tax Officer बनाम/ 5/A, Vrundavan Ward – 1(1)(3), Vadodara Vs. Bungalows, Near Mathura Nagari, Tandalja, Vadodara, Gujarat 390020 �थायी लेखा सं./जीआइआर सं./PAN/GIR No. : APNPS0058Q (Appellant) .. (Respondent) Ms. Amrin Pathan, A.R. अपीलाथ� ओर से /Appellant by : ��यथ� क� ओर से/Respondent by : Shri C S Sharma, Sr. DR 16/04/2024 Date of Hearing Date of Pronouncement 03/05/2024 O R D E R
PER SHRI NARENDRA PRASAD SINHA, AM:
This appeal is filed by the assessee against the order of the National Faceless Appeal Centre (NFAC), Delhi, (in short ‘the CIT(A)’) dated 27.09.2023 against the penalty order u/s. 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 30.06.2018 for the Assessment Year 2010-11.
(Shrenik Hiralal. vs. ITO) A.Y.– 2010-11 - 2 – 2. The grounds of the appeal raised by the assessee are as under:
“Ex-Parte Order: 1) The learned Commissioner of Income Tax (Appeals), National Faceless Appeal Center, Delhi ('NFAC') ('the CIT(A)') erred in fact and in law in passing the order ex-parte. 2) The learned CIT(A) erred in fact and in law in passing the order without granting proper opportunity of being heard. Without prejudice to the above: Penalty u/s 271(1)(c): 3) The learned CIT(A) erred in fact and in law in confirming the action of the learned Income Tax Officer, Ward 1(1)(3), Vadodara ('the Assessing Officer' or 'the AO') in levying a penalty of Rs. 8,00,000/- under section 271(1)(c) of the Act. 4) The learned CIT(A) erred in fact and in law in confirming the action of the learned AO in levying a penalty u/s 271(1)(c) of the Act on addition made on account of long-term capital gain amounting to Rs. 37,01,433/- for furnishing in accurate particulars of income. 5) The learned CIT(A) erred in fact and in law in confirming the action of the learned AO in levying a penalty u/s 271(1)(c) of the Act on addition made on account of long-term capital gain under section 50C of the Act which is nothing but a deeming provision. Limitation u/s 275: 6) The learned CIT(A) erred in fact and in law in confirming the action of the learned AO in levying a penalty of Rs. 8,00,000 under section 271(1)(c) of the Act even when the appeal against assessment order under section 147 of the Act was pending before CIT(A). 7) The learned CIT(A) erred in fact and in law in confirming the action of the learned AO of passing the order under section 271(1)(c) of the Act and not keeping the penalty proceedings under abeyance as per provision of section 275 of the Act.”
There is a delay of 80 days in filing of this appeal. The assessee had filed a condonation application and it is stated that (Shrenik Hiralal. vs. ITO) A.Y.– 2010-11 - 3 – the father of the assessee had expired on 03.04.2023 and following his death there were legal disputes amongst the legal heirs regarding his will. As the assessee was preoccupied with the family disputes and the legal proceedings, he could not file the appeal in time due to oversight. It was submitted that the delay was not intentional but purely circumstantial and requested for condonation thereof. Considering the reasons as explained by the assessee, the delay is condoned. The department also didn’t have any objection to the condonation of delay.
The assessee is an individual and did not file his return of income for A.Y. 2010-11. The proceeding under Section 147 of the Act was initiated and assessment was completed u/s. 143(3) / 147 of the Act on 18.12.2017 at total income of Rs.37,03,490/-. The AO made addition of Rs.37,01,433/- on account of capital gain generated on sale of immovable property. Penalty proceeding u/s. 271(1)(c) of the Act was also initiated.
Being aggrieved with the assessment order, the assessee filed appeal before the CIT(A) and the CIT(A) dismissed the appeal. The AO had passed penalty order u/s. 271(1)(c) of the Act on 30.06.2018 and penalty of Rs.8 Lakhs was imposed on the assessee. The assessee had challenged the penalty order before the CIT(A) and the appeal of the assessee was dismissed by the CIT(A) vide the impugned order against which the assessee is in present appeal.
(Shrenik Hiralal. vs. ITO) A.Y.– 2010-11 - 4 – 6. The ld. AR submitted that the assessee is a senior citizen and could not make proper compliance before the ld. CIT(A). It was further pointed out that an appeal against the order of the CIT(A) in quantum addition was preferred before the ITAT and that the ld. ITAT had decided the matter vide dated 14.02.2024 whereby the matter was set aside to the file of ld. CIT(A) for re-adjudication.
The ld. AR requested that since the appeal against quantum addition was still pending with the ld. CIT(A), the penalty matter may also be restored back to the file of the ld. CIT(A). The ld. DR had no objection to setting aside of the penalty matter to the file of the CIT(A).
We have carefully considered the request of the assessee. It is found that the quantum appeal was restored back to the file of the ld. CIT(A) for allowing another opportunity to the assessee and for proper adjudication of the issues on merits. Thus, when the issue of quantum addition is still pending before the ld. CIT(A) for re-adjudication, it will be proper that the penalty matter also be restored back to the file of the CIT(A). Accordingly, the matter is restored to the file of the ld. CIT(A) for re-adjudication of the penalty matter after deciding the quantum appeal. The assessee is also directed to make proper compliance before the ld. CIT(A) and file the necessary details for proper adjudication of the issue on merits.
(Shrenik Hiralal. vs. ITO) A.Y.– 2010-11 - 5 – 9. Since, the matter has been set aside to the file of the ld. CIT(A), other grounds taken by the assessee need not to be adjudicated at this stage.
In the result, appeal preferred by the assessee is partly allowed for statistical purposes.
This Order pronounced on 03/05/2024
Sd/- Sd/- (SUCHITRA RAGHUNATH KAMBLE) (NARENDRA PRASAD SINHA) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad; Dated 03/05/2024 S. K. SINHA True Copy आदेश क� ��त�ल�प अ�े�षत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant 2. ��यथ� / The Respondent. 3. संबं�धत आयकर आयु�त / Concerned CIT 4. आयकर आयु�त(अपील) / The CIT(A)- 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER,