RATROI MAA TRADING P.LTD,DELHI vs. ITO, WAZRD-21(1), NEW DELHI

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ITA 1778/DEL/2019Status: DisposedITAT Delhi07 August 2023AY 2009-103 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 held that since the addition, which formed the basis for the penalty, was deleted by a coordinate bench in the quantum appeal, the penalty cannot survive. Therefore, the penalty was deleted.

What were the facts?

The assessee's appeal challenges a penalty order under section 271(1)(c) of the Income-tax Act. The penalty was imposed based on an addition made to the assessee's income.

What were the issues?

Whether a penalty under section 271(1)(c) can be sustained when the underlying addition to income 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 BENCH “F”: NEW DELHI

Before: SHRI KUL BHARAT & DR. B.R.R. KUMAR

For Appellant: Shri Shil Gupta, CA
For Respondent: Shri Vivek Vardhan, Sr. DR
Hearing: 03.08.2023Pronounced: 07.08.2023

This appeal, by the assessee, is directed against the penalty order u/s 271(1)(c) of the Income-tax Act, 1961 (hereinafter referred to as the “Act”), passed

Commissioner of Income-tax (Appeals)-XXV, New Delhi, dated 02.01.2019, pertaining to the assessment year 2009-10. The solitary effective ground raised by the assessee is as under:

“That on the basis of facts and in the circumstances of the case and in law, Ld. CIT(A) erred in making addition by enhance income of Rs. 3,27,45,060/- and thereafter imposed penalty amounting to Rs. 1,01,18,224/- (@ 100%) under section 271(1)(c) of the Income-tax Act, 1961.”

2.

At the outset learned counsel for the assessee challenging the impugned penalty order submitted that in quantum proceedings the Coordinate Bench of this Tribunal in vide order dated 13.06.2023 has deleted the impugned addition, hence no penalty would survive.

3.

The learned DR, on the other hand, supported the impugned penalty order.

However, he fairly conceded that the Tribunal in quantum appeal being has deleted the addition.

4.

We have heard rival submissions and perused the material available on record. Admittedly in quantum proceedings the addition, which was the basis for imposing impugned penalty u/s 271(1)(c) of the Act, has since been deleted by the Coordinate Bench of this Tribunal vide its order dated 13.06.2023 rendered in ITA no. 7489/Del/2018. Therefore, since the very basis for levy of penalty has gone, the 271(1)(c) of the Act cannot survive and stands deleted accordingly. Ground of appeal is allowed.

5.

Appeal of the assessee is allowed.

Order pronounced in open court on 7th August, 2023.

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