DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 4(2), NEW DELHI, I.P.ESTATE, NEW DELHI V. BHARTI LAND LIMITED, AEROCITY, NEW DELHI

ITA 2495/DEL/2024

AI Insights

The case revolves around an appeal by the Deputy Commissioner of Income Tax against Bharti Land Limited concerning a penalty imposed under section 271(1)(c) for furnishing inaccurate particulars of income. The original assessment for A.Y. 2016-17 included significant additions and disallowances, which were partially overturned by the CIT(A) and subsequently by the ITAT in favor of the assessee. The penalty was based on the additions which were later deleted, leading the CIT(A) to annul the penalty. The Department's appeal to the ITAT contested this annulment, arguing that the penalty should remain despite the deletions, as they had filed an appeal against the ITAT's earlier decision. The Tribunal dismissed the Department's appeal, affirming the CIT(A)'s decision.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 34614 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2016-2017
• Other Referred Cases: CIT vs. Shishpal (2002) 172 CTR 410
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMIT KATOCH
• Assessee Lawyers: ANIL BHALLA
• Section: 143(3); 40(a)(ia)

Judgement Text

"Page 1 of 5 IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: ‘A’: NEW DELHI) BEFORE SHRI S.RIFAUR RAHMAN, ACCOUNTANT MEMBER AND SHRI SUDHIR PAREEK, JUDICIAL MEMBER ITA No:- 2495/Del/2024 (Assessment Year- 2016-17) Deputy Commissioner of Income Tax Circle – 4 (2) New Delhi Vs. Bharti Land Limited 3rd Floor, World Mark, 2 Asset, No.8, Aerocity NH-8, Delhi-110037 PAN No: AAGCB1520K APPELLANT RESPONDENT Appellant by : Shri Amit Katoch, Sr. DR Respondent by : Sh. Anil Bhalla, CA Sh. Nitin Sharma, CA Date of Hearing : 27.11.2024 Date of Pronouncement : 31.01.2025 ORDER PER SUDHIR PAREEK, JM The aforetitled appeal arising out of the order dated 21.02.2014 passed by the National Faceless Appeal Centre, Delhi (for the sake of convenience, here in after referred in short as NFAC] by which the application filed by the Revenue/ appellant against the order dated Page 2 of 5 28.12.2018 passed by the Assessing Officer [(for the sake of convenience, hereinafter referred in short as Ld. AO)] 2. The grievance of the revenue reads as under :- 1. Whether the Ld. CIT(A) has erred on facts and in law in allowing the penalty u/s. 271 (1)(c) for furnishing inaccurate particulars of income on the ground that quantum addition was allowed by ITAT without considering that the Department has filed appeal against ITAT order ? 2. The appellant craves leave for reserving the right to amend, modify alter add or forego any ground (s) of appeal at any time before or during the hearing of this appeal. 3. Facts of the case are that the assessee company was incorporated on January 12, 2015 for the purpose of acquiring constructing, developing and leasing/ sale of real estate properties in India or abroad. The return of income for A.Y. 2016-17 was e- filed on 29.09.2016 declaring total loss of Rs.4,06,96,408/-. The case was selected for scrutiny under CASS. During the assessment proceedings various notices were issued to the assessee and assessee complied the notices time to time. As per 2016-17 has been completed u/s. 143(3) of the IT Act, 1961 on 28.12.2018 determining total income at Rs.13,79,01,737/- after making the following addition : Page 3 of 5 1. Addition u/s. 40(a)(ia) of the Income Tax Act, 1961 of Rs.13,27,92,000/- 2. Disallowance of business loss of Rs.4,58,06,150/-. 4. The assessee filed appeal before the learned CIT(A) against the above order of the learned AO by challenging addition and disallowance made in assessment order dated 28.12.2018. The learned CIT(A) vide order dated 05.11.2019 deleted the addition u/s. 40(a)(ia) of the Act of Rs.13,27,92,000/- but disallowance of business loss of Rs.4,58,06,150/- order be sustained. Aggrieved, with the same, both the assessee/ revenue preferred appeal before ITAT, Delhi and co-ordinate Bench allowed the appeal of assessee whereas appeal of revenue dismissed vide order dated 24.09.2023. Meanwhile the learned AO passed order u/s. 271 (1)(c) of the Act to levy the penalty of Rs.1,51,44,890/- and in furtherance demand notice and challan issued. Thereafter the assessee/ appellant assail the penalty order before the learned CIT(A) and the learned first appellate authority vide impugned order deleted the penalty imposed as aforesaid, relevant para 4.3 and 4.4. of the order of the learned CIT(A) are as under:- “4.3. From the order of the Hon'ble, ITAT, it is evident that the addition made by the AO which was sustained by CIT(A) has since been directed to be deleted. Since the addition made in Page 4 of 5 the assessment order which formed the basis of levy of penalty itself no longer survives, no penalty could be levied thereon. 4.4. Reliance is place on the decision of the Hon'ble Rajasthan High Court in the case of CIT vs. Shishpal (2002) 172 CTR 410, for the reasons that once the very foundation for imposition of penalty had become non-existent, penalty would not survive.” 5. On the basis of foregoing discussion, we are of considered view that the learned CIT(A) passed impugned order with sound logic and there is nothing to interfere and the appeal of revenue devoid of merit liable to be dismissed. 6. In the result, the appeal of the revenue is dismissed. Order pronounced in open Court on 31st January, 2025 . Sd/- Sd/- (S.RIFAUR RAHMAN) (SUDHIR PAREEK) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 31/01/2025 NEHA, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI "