Gopal Kumar Goyal, New Delhi V. DCIT Central Circle-14, New Delhi

ITA 1466/DEL/2020

AI Insights

The case involves an appeal by Gopal Kumar Goyal against the penalty of Rs. 74 lakhs imposed by the Assessing Officer (AO) under section 271AAA of the Income Tax Act, 1961, for the assessment year 2008-09. Initially, the AO made additions to the assessee's income, which were later deleted by the CIT(A) in the first appeal. However, the revenue's appeal against this decision was dismissed by the Tribunal, which found the AO's approval process for the assessment to be mechanical and without application of mind, leading to the annulment of the assessment order. Consequently, the Tribunal held that the penalty, being based on an annulled assessment, could not stand and thus was directed to be deleted.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 131162 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 11 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-07-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 26-04-2023
• Assessment Year: 2008-2009
• Appeal Filed On: 04-08-2020
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 143(3); 153A

Judgement Text

Page | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “B”: NEW DELHI BEFORE Shri C.M. Garg, Judicial Member AND Shri M. Balaganesh, Accountant Member ITA No. 1466/Del/2020 (Assessment Year: 2008-09) Gopal Kumar Goyal, Flat No. 4, RR Apartments, 3-4, Mangalpuri, Mehrauli, New Delhi Vs. DCIT, Central Circle-14, New Delhi (Appellant) (Respondent) PAN: AEFPG8370J Assessee by : Ms. Monika Aggarwal, Adv Revenue by: Ms. Maimum Alam, Sr. DR Date of Hearing 27/04/2023 Date of pronouncement 14/07/2023 O R D E R PER C. M. GARG, J. M.: 1. This appeal has been filed against the order of the ld CIT(A)- 26, New Delhi dated 30.01.2020 for AY 2008-09 by which the ld CIT(A) confirmed the penalty of Rs. 74 lakhs imposed by the AO against the assessee u/s 271AAA of the Income Tax Act, 1961 (for short the Act). 2. The ld counsel of assessee submitted that for the same assessment year 2008-09 the AO made addition and the assessee carried the matter before the ld CIT(A) in the first appeal. She further pointed out that the ld CIT(A) allowed the appeal of assessee and deleted the addition. She further submitted that against the said first appellate order revenue preferred appeal in ITA NO. 1552/Del/2018 which was dismissed by the coordinate bench of the Tribunal by order dated 08.02.2023 passed in the group of 111 cases including said departmental appeal by holding that the approval ITA No. 1466/Del/2020 Gopal Kumar Goyal Page | 2 granted by the Additional CIT u/s 153D of the Act is mechanical and without application of mind therefore, all assessment orders including assessment order passed against the assessee u/s 143(3) read with section 153A of the Act for AY 2008-09was held as bad in law and ad the same was annulled. The ld counsel submitted that in view of the order of Tribunal dated 08.02.2023 (supra) in the group cases including the assessee then the penalty imposed by the AO u/s 271AAA of the Act cannot be held as sustainable and therefore, grounds of appeal may kindly be allowed and penalty imposed by the AO and upheld by the ld CIT(A) u/s 271AAA of the Act may kindly be deleted. 3. Replying to the above, the ld Sr. DR strongly supported the orders of the authorities below and submitted that under the facts and circumstances of the case the AO was right in imposing penalty u/s 271AAA of the Act however, the ld DR did not controvert or dispute the fact that the base assessment order passed by the AO for AY 2008-09 has been annulled by the Tribunal by allowing legal ground of assessee. 4. We have carefully perused the orders of the authorities below. We find force in the contention of the ld counsel of the assessee as the coordinate bench while deciding the bunch of 111 appeals has also considered and adjudicated cross appeals against the assessee listed at Sl No. 36 and 37 of the cause title of said tribunal order dated 08.02.2023 (supra). The coordinate bench while deciding the bunch of 111 appeals including the cross appeals pertaining to present assessee for AY 2008-09 in its order held as follows:- “38. From the above chart, it can be seen that investment of the share applicants/subscribers have been accepted in their respective assessment orders by same Assessing Officer who has sent proposal to the Additional CIT for making addition in the hands of the assessee. This clearly shows that the Additional CIT did not even care to ask the officer when he has accepted the investment in the hands of the subscribers, then why he is proposing addition in the hands of the assessees. ITA No. 1466/Del/2020 Gopal Kumar Goyal Page | 3 Since, as mentioned elsewhere, approval was completely devoid of any application of mind, these facts got completely ignored by the approving authority. 39. Considering the facts from all possible angles, we have no hesitation to hold that the approval granted by the Addl. CIT is mechanical and without application of mind and the assessment order so framed pursuant to such approval u/s 143(3) r.w.s 153A of the Act is bad in law and deserves to be annulled.” 5. Since foundation has been removed by the coordinate bench of the Tribunal by annulling the relevant assessment order therefore, the super structure including the penalty order u/s 271AAA of the Act has to fall. Accordingly, grounds of assessee are allowed and AO is directed to delete the impugned penalty. 6. In the result, appeal of the assessee is allowed. Order pronounced in the open court on 14/07/2023. -Sd/- -Sd/- (M. BALAGANESH) (C. M. GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 14/07/2023 A K Keot Copy forwarded to 1. Applicant 2. Respondent 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, New Delhi