Harsh Jain, New Delhi vs Assessee

This appeal, by the assesseeare, is directed against CIT(A)'s order dated 28-3-2014 relating to A.Y. 2009-10.

2. Brief facts of the case are that assessee had filed its return of income declaring income of Rs. 1,51,720/-. The assessment was completed at a total income of Rs. 18,76,720/-, after making following additions:

(i) U/s 68 Rs. 8,60,000 (ii) U/s 68 Rs. 6,00,000 (iii) Re-payment of loan Rs. 15,000 (iv) Re-payment of loan Rs. 2,50,000 2

3. The AO vide penalty order dated 22-10-2012 levied penalty of Rs. 10,37,400/- u/s 271(1)(c) of the Income-tax Act, inter alia, observing in para 4.4 of his order that it was not a fit case to keep the penalty in abeyance till disposal of appeal by the Tribunal.

4. At the time of hearing, ld. counsel for the assessee filed before us copy of Tribunal's order 24-9-2014 rendered in quantum appeal for the assessment year in question, being ITA no. 2973/Del/2012, deleting the additions made by the AO. He, therefore, submitted that in view of Tribunal's order in quantum appeal, the penalty in question does not survive.

5. We have heard rival submissions and perused the material available on record. We find that the ITAT vide order dated 24-9-2014 in ITA no. 2973/Del/2012 has deleted the additions made by the AO. Thus, since the very basis for levy of penalty has gone, the penalty in question does not survive. Accordingly, the penalty levied by AO and sustained by ld. CIT(A) u/s 271(1)(c) is deleted.

6. In the result, assessee's appeal is allowed.

Order pronounced in open court on 18-03-2015.

Sd/- Sd/- (C.M. GARG) ( S.V. MEHROTRA ) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 18-03-2015. MP Copy to : 1. Assessee 2. AO 3. CIT 4. CIT(A) 5. DR 3