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Issues involved: The judgment involves the confirmation of levy of penalty u/s. 158BFA(2) of the IT Act, based on the grounds that the penalty order was time-barred and that penalty was not leviable on merits.
Summary: 1. Issue 1 - Time-barred Penalty Order: The appellant challenged the penalty order on the grounds that it was time-barred u/s. 158BFA(3)(c) of the IT Act. The appellant argued that the penalty order was passed beyond the time specified in the statute, as the order from the Tribunal was received by the authorities before the penalty order was issued. The ld. CIT(A) upheld the penalty order, stating that the penalty was imposed within the limitation period as per the provisions of the Act. The Tribunal, however, disagreed with this interpretation, emphasizing that the penalty order was passed after the expiry of the limitation period provided under section 158BFA(3)(c). The Tribunal concluded that the penalty order was time-barred and therefore, no penalty could be levied against the assessee. 2. Issue 2 - Merits of Penalty: Apart from the time-barred aspect, the appellant also contended that the penalty was not leviable on merits under the law. The Tribunal did not delve into this issue as it found the penalty order to be time-barred. Consequently, the Tribunal set aside the orders of the authorities below levying and confirming the penalty, and allowed the appeal of the assessee. In conclusion, the Tribunal ruled in favor of the appellant, holding that the penalty order was time-barred u/s. 158BFA(3)(c) of the IT Act. As a result, the penalty imposed on the assessee was deemed invalid, and the appeal was allowed.
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