GUJARAT STATE ELECTRICITY CORPORATION LIMITED,AHMEDABAD V. THE DY. CIT, CIRCLE-1(1)(1), VADODARA

ITA 1223/AHD/2024

AI Insights

The Gujarat State Electricity Corporation Ltd. appealed against the penalties levied under section 271(1)(c) of the Income Tax Act, which were confirmed by the Commissioner of Income Tax (Appeals) for the assessment years 2012-13 and 2013-14. The penalties were based on disallowances related to Capital Grants & Subsidies, Consumers Contribution, and Liquidated Damages. The tribunal noted that the quantum issues concerning Capital Grants and the penalties related to these were set aside for re-examination by the Assessing Officer. Additionally, the penalties concerning Liquidated Damages were removed following a favorable adjudication in a related case.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 41034 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-10-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 23-10-2024
• Assessment Year: 2013-2014
• Appeal Filed On: 13-06-2024
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PROTHVIRA J M EENA
• Assessee Lawyers: MANISH J. SHAH; RUSHIN PATEL; A.RS
• Section: 271(1)(c)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, AHMEDABAD BEFORE DR. BRR KUMAR, ACCOUNTANT MEMBER & SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER I.T.A. Nos.1222&1223/Ahd/2024 (Assessment Years: 2012-13 & 2013-14) Gujarat State Electricity Corporation Ltd., Add: Sardar Patel Vidyut bhavan, Race Course Circle, Baroda-390007 Vs. Deputy Commissioner of Income Tax, Circle-1(1)(1), Vadodara [PAN No.AAACG6864F] (Appellant) .. (Respondent) Appellant by : Shri Manish J. Shah & Shri Rushin Patel, A.Rs. Respondent by: Shri Prothviraj Meena, CIT DR Date of Hearing 23.10.2024 Date of Pronouncement 23.10.2024 O R D E R PER DR. BRR KUMAR - ACCOUNTANT MEMBER: Both the appeals have been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Appeals), (in short “Ld. CIT(A)”), National Faceless Appeal Centre, (in short “NFAC”), Delhi, vide orders dated 02.05.2024 & 03.05.2024 passed for A.Ys. 2012-13 & 2013-14. ITA No. 1222/Ahd/2024(A.Y. 2012-13) 2. The Assessee has taken the following grounds of appeal:- “1. The learned Commissioner of Income Tax (Appeals) erred in law and on facts has confirmed the penalty of Rs.16,00,00,000/- levied under section 271(1)(c) of the Act on the additions made on account of disallowance out of Capital Grants & Subsidies and Consumers Contribution amounting to Rs.47,17,19,100/- without appreciating the fact that the impugned disallowance was a subject matter of long drawn discussion and debate. The learned Commissioner of Income Tax (Appeals) further erred in law and on facts has totally ignored the fact that on exactly identical facts the penalty for the immediately preceding year in the appellant’s own case has been fully deleted. ITA Nos. 1222&1223/Ahd/2024 Gujarat State Electricity Corporation Ltd. vs. DCIT Asst. Years –2012-13 & 2013-14 - 2– 2. The appellant craves leave to add, alter, delete or modify the above ground of appeal either before or at the time of hearing of this appeal.” 3. At the outset, both the parties fairly submitted that the quantum issue involved in the case pertaining to Capital Grant has been set-aside to the Assessing Officer for examination. Hence, the penalty order levied on that issue passed by the Assessing Officer is subjected to the provision of Section 275(1A) of the Act. Hence, the penalty order passed in this is also being set- aside to the Assessing Officer. 4. In the result, the appeal of the assessee is allowed for statistical purpose. ITA No. 1223/Ahd/2024(A.Y. 2013-14) 5. The assessee has raised the following grounds of appeal: “1. The learned Commissioner of Income Tax (Appeals) erred in law and on facts has confirmed the penalty of Rs. 33,00,00,000/- levied under section 271(1)(c) of the Act on the additions made on account of disallowance out of Capital Grants & Subsidies and Consumers Contribution and Liquidated Damages amounting to Rs. 26,94,59,496/- and Rs. 73,00,00,000/- respectively. The learned Commissioner of Income Tax (Appeals) ought to have appreciated impugned disallowances on account of Capital Grants & Subsidies and Consumers Contribution were a subject matter of long drawn discussion and debate. This apart the disallowances on account of Liquidated Damages were deleted by the Tribunal vide Order dated 31-10- 2023. The learned Commissioner of Income Tax (Appeals) further erred in law and on facts has totally ignored the fact that on exactly identical facts the penalty levied on account of capital grant & subsidies etc., for the immediately preceding year in the appellant’s own case has been fully deleted. 2. The appellant craves leave to add to, alter, delete or modify the above ground of appeal either before or at the time of hearing of this appeal.” 6. At the outset, both the parties fairly submitted that the issue involved in the quantum appeal pertaining to liquidated damages stands adjudicated in ITA Nos. 1222&1223/Ahd/2024 Gujarat State Electricity Corporation Ltd. vs. DCIT Asst. Years –2012-13 & 2013-14 - 3– favour of the assessee. Hence, we hold that no penalty is leviable on this issue. 7. With regard to the issue of Capital Grants, the matter has been set- aside to the Assessing Officer is subjected to the provision of Section 275(1A) of the Act. Hence, the penalty order passed in this is also being set-aside to the Assessing Officer. 8. In the result, the appeal of the assessee is allowed for statistical purposes. 9. In the combined result, both the appeals filed by the assessee are allowed for statistical purposes. The order is pronounced in the open Court on 23.10.2024 Sd/- Sd/- (SIDDHARTHA NAUTIYAL) (DR. BRR KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad; Dated 23/10/2024 TANMAY, Sr. PS TRUE COPY आदेश की Ůितिलिप अŤेिषत/Copy of the Order forwarded to : 1. अपीलाथŎ / The Appellant 2. ŮȑथŎ / The Respondent. 3. संबंिधत आयकर आयुƅ / Concerned CIT 4. आयकर आयुƅ(अपील) / The CIT(A)- 5. िवभागीय Ůितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाडŊ फाईल / Guard file. आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad "