JEET SINGH,GURUGRAM vs. ITO WARD-2(2), GURGAON

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ITA 345/DEL/2021Status: DisposedITAT Delhi12 September 2023AY 2008-09Bench: SHRI PRADIP KUMAR KEDIA (Accountant Member), SHRI YOGESH KUMAR US (Judicial Member)2 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 quantum proceedings, from which the penalty arose, had been annulled by a Co-ordinate Bench. Consequently, the penalty order was deemed to have no legal basis and was deleted.

What were the facts?

The assessee challenged a penalty of Rs. 1,01,56,420/- imposed under Section 271(1)(c) of the Income Tax Act, 1961, which arose from quantum additions of Rs. 3 crore. The assessee's counsel submitted that the quantum proceedings had been annulled by a Co-ordinate Bench of the Tribunal.

What were the issues?

Whether a penalty imposed under Section 271(1)(c) can survive if the underlying assessment order is annulled due to defects in reassessment proceedings.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 147

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “C” DELHI

Before: SHRI PRADIP KUMAR KEDIA & SHRI YOGESH KUMAR US

For Appellant: Shri Mahvir Singh, Adv
For Respondent: Shri D.K. Srivastava, Sr. DR

PER PRADIP KUMAR KEDIA, A.M.: The captioned appeal has been filed by the Assessee against the order of the Commissioner of Income Tax (Appeals)-II, Gurgaon [‘CIT(A)’ in short] dated 05.03.2020 arising from the penalty order dated 15.03.2018 passed by the Assessing Officer (AO) under Section 271(1)(c) of the Income Tax Act, 1961 (the Act) concerning AY 2008-09.

2.

As per grounds of appeal, the assessee has challenged the imposition of penalty of Rs.1,01,56,420/- arising out of quantum additions of Rs.3 crore.

1.

2. At the outset, ld. counsel for the assessee submitted that in the quantum proceedings, the Co-ordinate Bench of the Tribunal vide order dated 24.06.2021 in has set aside the order of the ld. CIT (A) and quashed the proceedings initiated u/s.147 of the Act and as a consequence, the assessment order itself stood annulled. As a corollary to such annulment of assessment order, the consequential penalty order has no legs to stand in the eyes of law.

3.

Learned Department Representative has not expressed any objection and he too admitted that in the quantum proceedings are rendered nonest.

4.

On appraisal of such factual matrix, we find that in the quantum proceedings, the Tribunal has set aside the order of the Ld. CIT (A) and allowed the quantum appeal. Hence, the impugned penalty flowing from assessment order is deleted.

5.

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

Order was pronounced in the open Court on 12/09/2023.

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