Bhansali & Co., Mumbai vs Assessee
- CitationI.T.A. No.6586/Mum/2012
Ratio decidendi
The rule this decision rests on
The levy of penalty under section 271(1)(c) cannot survive where it rests solely on an addition under section 40A(2)(b) which has been set aside and restored to the Assessing Officer for fresh consideration in the quantum proceedings; the penalty order falls with the quantum basis on which it was founded, without prejudice to the Assessing Officer's power to revisit the question of penalty in the set-aside proceedings if he considers it necessary.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
M/s Bhansali and Co., बनाम/ Dy Commissioner of Income EE-7010, Vs. Tax, 16(3), Bharat Diamond Bourse, Room No.206, 2nd floor, Bandra Kurla Complex, Matru Mandir, Bandra (E), Tardeo Road, Mumbai-400051 Mumbai-400007
(अपीलाथ /Appellant) .. ( यथ / Respondent)
थायी ले ख ा सं . /जीआइआर सं . /PAN/GIR No. :AACFB8643C
अपीलाथ ओर से / Assessee by: Shri Apurva Shah
यथ क$ ओर से/ Revenue by:: Shri Vivek Batra
सन ु वाई क$ तार(ख / Date of Hearing :6.1.2015 घोषणा क$ तार(ख /Date of Pronouncement :18. 2.2015
आदे श / O R D E R
Per B.R.BASKARAN, Accountant Member:
The assessee has filed this appeal challenging the order dated
25.9.2012 passed by the ld.CIT(A)-27, Mumbai confirming the penalty of
Rs.16,09,200/- levied by the AO under section 271 (1)(c) of the Income
Tax Act, 1961.
2. The ld. counsel appearing for the assessee submitted that the AO
has levied penalty under section 271(1)(c) of the Act in respect of
disallowance made under section 40A(2)(b) of the Act. The ld. counsel ITA No.6586/M/12 2
submitted that the assessee challenged the disallowance by filing the
appeals before the ld. CIT(A) as well as Income Tax Appellate Tribunal.
The ld.counsel submitted that the Tribunal, vide its order dated
19.12.2019 passed in assessee's quantum appeal bearing ITA
No.2282/Mum/2010 (AY-2005-06), has set aside the matter relating to the
addition made u/s 40A(2)(b) of the Act to the file of the AO with a
direction to consider the same afresh. Accordingly, the ld. AR submitted
that the impugned penalty order does not survive in the eyes of law in
view of the order passed by the Tribunal in the quantum proceedings.
3. We have heard the ld D.R and perused the record. The assessee
has filed a copy of the order passed by the Tribunal in quantum appeal
and we notice from that order that the addition made u/s 40A(2)(b) of the
Act has been restored to the file of the AO. We have already noticed that
the AO has levied penalty u/s 271(1)(c) of the Act in respect of the said
addition only, which has since been restored to the file of the AO. Hence
we find merit in the contentions of Ld A.R. However, the AO may consider
about the levy of penalty u/s 271(1)(c) in the set aside proceedings, if he
considers it to be necessary to do so.
ITA No.6586/M/12 3
4. In the result, the appeal filed by the assessee is treated as allowed.
The above order was pronounced in the open court on 18th Feb,
2015.
घोषणा खल ु े यायालय म+ ,दनांकः18th Feb, 2015 को क$ गई ।
sd sd
(आय.पी. बंसल/I.P. BANSAL) (बी.आर. बा करन,/ B.R. BASKARAN) या यक सद य / Judicial Member लेखा सद य/Accountant Member
मुंबई Mumbai: 18th Feb,2015.
व. न.स./ SRL , Sr. PS
आदे श क त ल प अ े षत/Copy of the Order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent.
3. आयकर आयु6त(अपील) / The CIT(A)- concerned
4. आयकर आय6 ु त / CIT concerned
5. 7वभागीय त न9ध, आयकर अपील(य अ9धकरण, मंब ु ई/ DR, ITAT, Mumbai concerned
6. गाड फाईल / Guard file.
आदे शानुसार/ BY ORDER, true copy सहायक पंजीकार (Asstt. Registrar) आयकर अपील(य अ9धकरण, मुंबई /ITAT, Mumbai
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