Shri. Vikram Kothari, Bangalore V. Income-Tax Officer Ward-(3)(2)(1), Bangalore

ITA 274/BANG/2023

AI Insights

The case involves Shri Vikram Kothari, the appellant, contesting a penalty imposed under section 271AAC of the Income Tax Act, 1961, amounting to Rs.1,98,021. The penalty was levied following an assessment that added Rs.33,00,360 to the appellant's income, treating certain purchases as bogus. The CIT(A) upheld the penalty due to the appellant's failure to provide explanations in response to notices. The appellant argued that the quantum assessment was still under appeal, and thus, the penalty proceedings should be adjourned. The Tribunal agreed to restore the matter to the CIT(A) for a decision post the resolution of the quantum assessment.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 124887 (ITAT-BANGALORE)
• Duration Of Justice: 1 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-05-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 24-05-2023
• Assessment Year: 2018-2019
• Appeal Filed On: 02-04-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 69C; 143(3); 250

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH : BANGALORE BEFORE SHRI GEORGE GEORGE K, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER ITA No.274/Bang/2023 Assessment Year : 2018-19 Shri. Vikram Kothari, No.33, K H Ranganatha Colony, Mysore Road, Karnataka – 560 039. PAN : AHLPK 1971 C Vs. The Income Tax Officer, Ward – 3(2)(1), Bengaluru. APPELLANTRESPONDENT Assessee by:Shri.Ravishankar S. V, Advocate Revenue by :Shri.Gudimella VP Pavan Kumar,JCIT (DR)(ITAT), Bengaluru. Date of hearing:25.05.2023 Date of Pronouncement:25.05.2023 O R D E R Per George George K, Judicial Member: This appeal at the instance of the assessee is directed against order of CIT(A), dated 08.03.2023, passed under section 250 of the Income Tax Act, 1961 (hereinafter called ‘the Act’). The relevant Assessment Year is 2018-19. 2. The assessee has raised 8 grounds of appeal. All the grounds relate to the solitary issue of imposing of penalty under section 271AAC of the Income Tax Act, 1961 (hereinafter called ‘the Act’), amounting to Rs.1,98,021/-. The brief facts of the case are as follows: ITA No.274/Bang/2023 Page 2 of 4 Assessee is an individual. For the Assessment Year 2018-19, the return of income was filed on 25.10.2021 declaring a total income of Rs.7,31,190/. The assessment was completed vide order dated 17.05.2021 under section 143(3) r.ws. 144B of the Act, making an addition of Rs.33,00,360/- under section 69C of the Act. The addition was on account of disallowance of purchases treating the same as bogus. 3. Subsequently, penalty proceedings were initiated and notice dated 17.05.2021 was issued to the assessee. The assessee filed objections to the show cause notice. However, the submissions made by the assessee were rejected and the AO imposed a penalty under section 271AAC(1) of the Act amounting to Rs.1,98,020/-. 4. Aggrieved by the order of the AO imposing the penalty, assessee filed appeal before the First Appellate Authority (FAA). Before the CIT(A), the assessee in response to the three notices issued, submitted that the penalty appeal may be kept in abeyance since the quantum assessment was pending adjudication before him. The assessee did not file a written submission in response to the three notices issued. Hence, the CIT(A) dismissed the appeal of the assessee by observing as under: “In the absence of any explanation from the appellant, I have no option but to concur the opinion of AO levying the penalty of Rs. 1,98,021/- u/s.271AAC(1) of the Act. Ground Nos. 3,4,5,6,7 & 9 are dismissed.” 5. Aggrieved by the order of the CIT(A) confirming the penalty imposed under section 271AAC of the Act, assessee has filed the present appeal before the Tribunal. The learned AR submitted that, as regards the quantum assessment, ITA No.274/Bang/2023 Page 3 of 4 the assessee has filed an appeal as the same is pending adjudication even as on today before the CIT(A). It was submitted that since the quantum assessment was pending, assessee had sought for adjourning the appeal as against the order imposing penalty. It was stated that the CIT(A), without considering the adjournment application and also in the absence of a written submission, has erred in confirming the penalty imposed under section 271AAC of the Act. Hence, it was prayed that the assessment may be restored to the file of the CIT(A) so that the penalty appeal can be taken up after a decision is taken in the appeal against the quantum assessment. 6. The learned DR supported the orders of the AO imposing penalty and CIT(A)’s order confirming the same. 7. We have heard the rival submissions and perused the material on record. The assessee, in response to the three notices issued, had sought for adjournment of the case by stating the quantum assessment is pending. The assessee has not filed any written submission. Therefore, in the interest of justice and equity, we are of the view that the matter needs to be examined afresh by the CIT(A) since there were no submissions submitted by the assessee before him. Accordingly, the matter is restored to the file of the CIT(A). The CIT(A) is directed to take a decision in the quantum assessment before a decision is rendered in the appeal as against the order imposing the penalty. The assessee is directed to co-operate with the CIT(A) and shall furnish the necessary evidences and written submissions in support of his case. It is ordered accordingly. ITA No.274/Bang/2023 Page 4 of 4 8. In the result, appeal of the assessee is allowed for statistical purposes. Pronounced in the open court on the date mentioned on the caption page. Sd/- Sd/- (LAXMI PRASAD SAHU) (GEORGE GEORGE K) Accountant MemberJudicial Member Bangalore. Dated: 25.05.2023. /NS/* Copy to: 1.Appellants2.Respondent 3.CIT4.CIT(A) 5.DR, ITAT, Bangalore.6.Guard file By order Assistant Registrar, ITAT, Bangalore.