HERITAGE RESORTS PRIVATE LTD,DELHI V. DEPUTY COMMISSIONER, DELHI

ITA 6231/DEL/2025

AI Insights

Heritage Resorts Pvt. Ltd. appealed against the penalty imposed by the Deputy Commissioner of Income Tax, which was based on an alleged disallowance of provision of expenditure for the assessment year 2015-16. The primary contention was the ambiguity in the show cause notice dated 15.09.2017, which did not clearly specify under which limb of Section 271 the penalty was being considered. The National Faceless Appeal Centre (NFAC) had dismissed the appeal, citing non-appearance and reliance on previous cases. However, the Tribunal found the NFAC's order to lack coherence and proper judicial discipline, leading to the quashing of the penalty.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 839236 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2015-2016
• Appeal Filed On: 02-10-2025
• Other Referred Cases: CIT Vs. BN(1997) 118 taxman.com 451, CIT vs. Multiplan India (P.) Ltd. [1991] 38 ITD 320 (Del), PCIT-4 Vs. Gragerious Projects Pvt. Ltd. (2025) 303 taxman 14, CIT Vs. SSA2016 (8) TMI 1147
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AKHILESH YADAV
• Assessee Lawyers: MANISH TATIWAL
• Section: 143(3); 271(1)(c)

Judgement Text

"P a g e | 1 ITA No. 6231/Del/2025 Heritage Resorts Pvt. ltd. (AY: 2015-16) IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, DELHI BEFORE SHRI ANUBHAV SHARMA, JUDICIAL MEMBER & SHRI MANISH AGARWAL, ACCOUNTANT MEMBER ITA No.6231/Del/2025 (Assessment Year: 2015-16) Heritage Resorts Pvt. Ltd. The Lodhi Road, Delhi – 110001 Vs. Deputy Commissioner New Central Revenue, Delhi-110001 \u0001थायीलेखासं./जीआइआरसं./PAN/GIR No: AAACH0026Q Appellant .. Respondent Appellant by : Sh. Manish Tatiwal, Adv. Respondent by : Sh. Akhilesh Yadav, Sr. DR Date of Hearing 11.02.2026 Date of Pronouncement 18.02.2026 O R D E R PER ANUBHAV SHARMA, JM: This appeal preferred by the assessee against the order dated 21.07.2025 of Ld. National Faceless Appeal Centre (NFAC), Delhi, (hereinafter referred to as the First Appellate Authority or ‘the ld. FAA’ for short) in DIN & Order No: ITBA/NFAC/S/250/2025-26/1078713347(1) Printed from counselvise.com P a g e | 2 ITA No. 6231/Del/2025 Heritage Resorts Pvt. ltd. (AY: 2015-16) arising out of the assessment order dated 15.09.2017 u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) passed by DCIT, Circle- 11(1), New Delhi,for AY: 2015-16. 2. On hearing both sides we find that the issue involved is the levy of penalty on the appellant for alleged disallowance of provision of expenditure. However, before us ld. AR has stressed on the ground that the penalty order is based on a notice which is ambiguous as the notice date 15.09.2017 does not show as to which of the two limbs of Section 271 are attracted. 3. In this context, we find that in the Assessment Order it was mentioned that penalty u/s 271(1)(c) is initiated in allegation that assessee has furnished inaccurate particulars. Copy of notice on record shows that assessee was called upon by notice dated 15.09.2017, show cause for both the violations of ‘having concealed particulars of income or furnishing inaccurate particulars of such income’. 4. We find that the ld. First Appellate Authority, NFAC, has passedan order, which lacks coherence,where in para 4.1 & 4.2 the appeal of the assessee is dismissed for non appearance by relying decision in CIT Vs. Printed from counselvise.com P a g e | 3 ITA No. 6231/Del/2025 Heritage Resorts Pvt. ltd. (AY: 2015-16) BN(1997) 118 taxman.com 451 and in CIT vs. Multiplan India (P.) Ltd. [1991] 38 ITD 320 (Del). 4.1 Then in subsequent paras, NFAC, as declined to condone the delay in filing the appeal allegedly of 350 days. 4.2 Further, the merits of the case have been discussed and the levy of penalty is sustained thereby dismissing the appeal. 5. It appears that there is complete non application of mind and following judicial discipline in passing the impugned order. The impugned order does not appear to be merely faceless but act of utter casualness not acceptable in cases of quasi judicial proceedigns. 6. In the light of aforesaid circumstances we consider it appropriate case where the impugned order of ld. CIT(A) needs to be quashed here. Further, the ends of justice require that the merits of the ground of penalty order being on the basis of ambiguous show cause notice needs to be sustained. As it is a trite law that the penalty notice should be categorically as to which limb assessee is show caused and penalty is proposed to be levied. Reliance in this regard can be placed on the decision of Hon’ble jurisdictional High Court in Printed from counselvise.com P a g e | 4 ITA No. 6231/Del/2025 Heritage Resorts Pvt. ltd. (AY: 2015-16) the case of PCIT-4 Vs. Gragerious Projects Pvt. Ltd. (2025) 303 taxman 14 and the decision of Hon’ble Supreme Court in the case of CIT Vs. SSA’s Emerald Meadows (2016) (8) TMI 1147. 6. The appeal of the assessee is allowed and the impugned penalty order is quashed. 5. The appeal of the assessee is allowed. Order pronounced in the open court on 18.02.2026 Sd/- (Manish Agarwal) Sd/- (Anubhav Sharma) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated 18.02.2026 Rohit, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI Printed from counselvise.com "