Quadrant Epp Surlon Uttaranchal (P) ... vs Department Of Income Tax
- CitationITA no. 2081/Del/2013
Ratio decidendi
The rule this decision rests on
The Tribunal's reasoning rests on two points. First, where the income determined under the normal provisions of the Act, after giving effect to the appellate order in the quantum proceedings, is lower than the figure on which the penalty was founded, the basis for levying penalty under section 271(1)(c) falls away, so the penalty cannot stand. Second, an appeal by the department is not maintainable where the tax effect of the disputed addition is below the monetary limit prescribed by the CBDT circular dated 9 February 2011 (Circular No. 3/2011), and the department cannot rebut the assessee's factual position on that tax effect.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
1 ITA no. 2081/Del/2013
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH "B" NEW DELHI BEFORE SHRI S.V. MEHROTRA : ACCOUNTANT MEMBER AND SHRI GEORGE GEORGE K.: JUDICIAL MEMBER
ITA no. 2081/Del/2013 A.Y. 2005-06 DCIT, Circle-14(1), Vs. Quardant EPP Suron Uttaranchal (P) Ltd., New Delhi. 4, Pocket-1, Jasola Vihar, New Delhi. PAN: AAACQ 0944 J ( Appellant ) ( Respondent )
Appellant by : None Respondent by : Shri J.P. Chandrakar Sr. DR
Date of hearing : 01-12-2014 Date of order : 09-01-2015.
ORDER
PER S.V. MEHROTRA, A.M:-
This appeal, preferred by the department, is directed against the order dated 31-01-2013, passed by the CIT(Appeals)-XVII, New Delhi in appeal no. 21/CIT(A)XVII/Del/2011-12, deleting the penalty levied by AO u/s 271(1)(c) of the I.T. Act, 1961, relating to A.Y. 2007-08.
2. Brief facts of the case are that assessee had filed return declaring total income at Rs. Nil, but had paid taxes u/s 115JB of the Act. The AO completed the assessment u/s 143(3) of the Act, determining the total income at Rs. 15,98,290/-. The AO initiated penalty proceedings u/s 271(1)(c) and levied penalty at Rs. 5,84,855/-. Ld. CIT(A) deleted the penalty by following the decision of Hon'ble Delhi High Court in the case of CIT Vs. Nalwa Sons Investments Ltd. 327 ITR 543, wherein it has been held 2 ITA no. 2081/Del/2013
that no penalty can be levied u/s 271(1)(c) when the income u/s 115JB is higher than the income assessed under normal provisions of the Act.
3. We have considered the submissions of ld. Sr. DR and have perused the material available on record. We find, from the written submissions filed by the assessee, that after giving effect to CIT(A)'s order in the quantum appeal, the income determined under the normal provisions of the I.T. Act, was only s. 2,90,956/- and not Rs. 15,98,285/-. It is further pointed out that the tax payable on this income comes to Rs. 87,287/- and, therefore, the department should not have filed the second appeal in view of the CBDT Circular no. 3/2011 dated 9-2-2011, when the amount payable was below Rs. 3,00,000/-. Ld. DR could not controvert the factual position as narrated in the written submissions. Thus, in any view of the matter, penalty levied u/s 271(1)(c) has no legs to stand. Accordingly, department's appeal is liable to be dismissed and we do so.
4. In the result, departmental appeal is dismissed.
Order pronounced in open court on 09-01-2015.
Sd/- Sd/- ( GEORGE GEORGE K. ) ( S.V. MEHROTRA ) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 09-01-2015. MP Copy to : 1. Assessee 2. AO 3. CIT 4. CIT(A) 5. DR 3 ITA no. 2081/Del/2013
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