DHAVAL MAHESHBHAI GANATRA,RAJKOT vs. INCOME TAX OFFICER, WARD 3(1)(1)

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ITA 246/RJT/2022Status: DisposedITAT Rajkot10 February 2023AY 2015-16Bench: Ms SUCHITRA KAMBLE, JUDICIAL MEMBER, SHRI WASEEM AHMED (Accountant Member)2 pages
AI SummaryDismissed

What did the Tribunal hold?

The tribunal held that since the quantum addition, which formed the basis for the penalty, was set aside by the ITAT for fresh adjudication, the penalty order under Section 271(1)(c) was not sustainable.

What were the facts?

The assessee filed an appeal against a penalty order under Section 271(1)(c) of the Income Tax Act. There was a significant delay in filing the appeal, which was condoned by the tribunal.

What were the issues?

Whether a penalty under Section 271(1)(c) can be sustained when the underlying quantum addition has been set aside. The issue of delay in filing the appeal was also addressed.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

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  • 125 Taxmann.com 151
    125 Taxmann.com 151
    9 citing

Income Tax Appellate Tribunal, ‘’ RAJKOT BENCH”, RAJKOT

Before: Ms SUCHITRA KAMBLE, & SHRI WASEEM AHMED

Hearing: 19/01/2023Pronounced: 10/02/2023

आदेश/O R D E R

PER WASEEM AHMED, ACCOUNTANT MEMBER:

1.

The captioned appeal has been filed at the instance of the Assessee against the order of the Learned Commissioner of Income Tax (Appeal), Rajkot, dated 22/04/2017 arising in the matter of penalty order passed under s. 271(1)(c) of the Income Tax Act, 1961 (here- in-after referred to as "the Act") relevant to the Assessment Year 2015-2016.

2.

The Ld. AR at the outset brought to our notice that there is a delay in filing the appeal of the assessee for 297 days which is falling during the covid-19 period therefore the same should be condoned. The Ld. AR in support of his contention regarding the delay in filing the appeal has also filed the affidavit which is available on record.

3.

The Ld. DR did not raise any objection on the condonation of delay in filing the appeal by the assessee. Accordingly, we condone the delay in filing the appeal by the assessee in pursuance to the judgment of Hon’ble SC in the case of Cognizance for Extension of Limitation, reported in 125 taxmann.com 151 and proceed to adjudicate the issue on merit.

4.

At the outset, we note that the quantum addition made by the authority below has already been set aside to the file of the AO for fresh adjudication in vide order dated 3-2-2023. Once, the quantum addition has been set aside to the file of the AO, the question of levying penalty under the provision of section 271(1)(c) of the Act does not arise. It is for the reason that the penalty is levied under the provision of section 271(1)(c) of the Act, based on the quantum additions made during the assessment proceedings which have been set aside. Thus, in the given case, the penalty order based u/s 271(1)(c) of the Act is not sustainable. As such, the AO will initiate the fresh penalty proceedings against the assessment order to be made in pursuance to the direction of the ITAT in the quantum appeal as discussed above. Hence, the ground of appeal of the assessee is dismissed as infructuous.

5.

In the result, the appeal filed by the assessee is dismissed as infructuous.

Order pronounced in the Court on 10/02/2023 at Ahmedabad.

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