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Income Tax Appellate Tribunal, DELHI ‘G’ BENCH,
Before: SHRI N.K. BILLAIYA, & SHRI YOGESH KUMAR U.S
PER N.K. BILLAIYA, ACCOUNTANT MEMBER:-
This appeal by the assessee is preferred against the order of the ld. CIT(A) – 26, Delhi dated 30.01.2020 pertaining to Assessment Year 2008-09.
The sum and substance of grievance of the assessee is that the ld. CIT(A) erred in upholding the penalty of Rs. 27.20 lakhs levied by the Assessing Officer u/s 271AAA of the Income-tax Act, 1961 [the Act, for short].
At the very outset, the ld. counsel for the assessee pointed out that the assessment order has been annulled by this Tribunal in a bunch of 111 appeals in which the appeal of the assessee is at Sl. No. 66 in ITA No. 1288/DEL/2018. It is the say of the ld. counsel for the assessee that since the assessment order has been annulled, penalty so levied does not have any legs to stand.
The ld. DR strongly contested this submission of the ld. counsel for the assessee and vehemently stated that even if the assessment order was annulled, penalty is leviable u/s 271AAA of the Act.
5. Though the ld. DR fairly conceded that this Tribunal has annulled the impugned assessment order.
We have carefully considered the rival contentions and have perused the orders of the authorities below. We have also gone through impugned order of the co-ordinate bench by which it decided 111 appeals alongwith the appeal of the assessee at Sl. No. 66 in ITA No. 1288/DEL/2018. The relevant findings read as under:
“38. From the above chart, it can be seen that investment of the share applicants/subscribers have been accepted in their respective assessment orders by same Assessing Officer who has sent proposal to the Additional CIT for making addition in the hands of the assessee. This clearly shows that the Additional CIT did not even care to ask the officer when he has accepted the investment in the hands of the subscribers, then why he is proposing addition in the hands of the assessees. Since, as mentioned elsewhere, approval was completely devoid of any application of mind, these facts got completely ignored by the approving authority.
Considering the facts from all possible angles, we have no hesitation to hold that the approval granted by the Addl. CIT is mechanical and without application of mind and the assessment order so framed pursuant to such approval u/s 143(3) r.w.s 153A of the Act is bad in law and deserves to be annulled.
Since the foundation has been removed by the coordinate bench of the Tribunal by annulling the relevant assessment order, therefore, the super structure including the penalty order u/s 271AAA of the Act has to fall. Accordingly, grounds of assessee are allowed and the assessing officer is directed to delete the impugned penalty”
Respectfully following the above, the grounds of assessee are allowed.
In the result, the appeal of the assessee in is allowed.
The order is pronounced in the open court on 18.08.2023.