2023 (8) TMI 443 - AT - Income Tax

Penalty u/s 271(1)(c) - substantive addition made of unexplained investment in purchase of land in Kotali - HELD THAT - On due consideration of the facts and circumstances, and the submissions of both the parties, and the order of the ITAT 2021 (11) TMI 1163 - ITAT AHMEDABAD having deleted the additions on which penalty was levied u/s 271(1)(c) of the Act for both the assessment years, there remains no basis for levy of penalty. Decided in favour of assessee.

Summary

Issues Involved:
The judgment involves appeals filed by the Revenue against penalty deletion u/s 271(1)(c) of the Income Tax Act, 1961 for the Assessment Years 2012-13 and 2013-14.

Issue 1: Penalty Deletion u/s 271(1)(c) - Assessment Year 2012-13 and 2013-14

The Revenue challenged penalty deletion by the ld. CIT(A) under section 271(1)(c) of the Act. The AO imposed a penalty based on unexplained investment in land. However, during the proceedings, the Tribunal deleted the quantum additions made by the AO. The ld. CIT(A) considered the Tribunal's decision in quantum proceedings and deleted the penalty. The Tribunal noted that once the quantum additions were deleted, the penalty had no basis to stand on. The ld. DR did not contest the factual aspect, leading to the dismissal of the Revenue's appeals as they became infructuous.

Conclusion:
The Tribunal dismissed the Revenue's appeals against penalty deletion u/s 271(1)(c) for the Assessment Years 2012-13 and 2013-14, citing the deletion of quantum additions by the Tribunal as the basis for nullifying the penalty.