KANTILAL MOHANLAL PAREKH,MUMBAI V. WARD 22(2)(1), MUMBAI, MUMBAI

ITA 3037/MUM/2025

AI Insights

The case involves Kantilal Mohanlal Parekh, the appellant, who contested a penalty imposed by the Income Tax Officer (ITO) under section 271(1)(c) of the Income-tax Act, 1961, following an assessment order that added Rs.3.05 crores to his income. The initial assessment was completed under sections 144/147, and the penalty was levied for tax evasion amounting to Rs.94,41,594. The Commissioner of Income Tax (Appeals) [CIT(A)] confirmed the penalty after the quantum addition was set aside for reassessment. The Tribunal, however, found that the penalty lacked merit as it was directly linked to the now-set-aside additions and thus restored the penalty issue to the ITO for a decision post-reassessment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 707087 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2012-2013
• Appeal Filed On: 30-04-2025
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HEMANSHU JOSHI
• Assessee Lawyers: KIRAN MEHTA AW RAVI
• Keywords: Set aside; Reassessment proceedings
• Section: 147; 144; 271(1)(c)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “E”, MUMBAI BEFOR SHRI ANIKESH BANERJEE, JUDICIAL MEMBER AND SMT. RENU JAUHRI, ACCOUNTANT MEMBER ITA No.3037/Mum/2025 (Assessment year: 2012-13) Kantilal Mohanlal Parekh Flat No.502, Link Apartment Plot No.357, 13th Road, Khar (West), Mumbai-400 052 PAN : AQEPP6782A vs ITO WARD 22(2)(1), MUMBAI Piramal chambers, Lalbaug Parel, Mumbai APPELLANT RESPONDENT Assessee by Shri Kiran Mehta a/w Shri Ravi Dasija Respondent by Shri Hemanshu Joshi, SR DR Date of hearing : 07/07/2025 Date of pronouncement : 10/ 07/2025 O R D E R PER ANIKESH BANERJEE, J.M: The instant appeal of the assessee was filed against the order of the National Faceless Appeal Centre, Delhi [for brevity, ‘Ld. CIT(A)’] passed under section 250 of the Income-tax Act, 1961 (in short, ‘the Act’), for Assessment Year 2012-13, date of order 17.03.2025. The impugned order was emanated from the order of the 2 ITA No.3037 /Mum/2025 Shri Kantilal Mohanlal Parekh Learned Income-tax Officer, Ward 22(2)(1), Mumbai (in short, the Ld. A.O.’) passed under section 271(1)(c) of the Act, date of order 26/03/2022. 2. We heard the rival submissions and considered the documents available on the record. The Ld.AR stated that the original assessment was completed under section 144/147 of the Act by making total addition of Rs.3.05 crores. The assesse challenged the assessment order passed under section 144 / 147 of the Act dated 10/12/2019 before the Ld.CIT(A). The Ld.CIT(A) by executing his powers under section 250 of the Act, set aside the alleged assessment order to the file of the Ld.AO for adjudication de novo. After completion of assessment proceeding, the Ld.AO imposed penalty under section 271(1)(c) of the Act at 100% of tax sought to be evaded amount to Rs.94,41,594/-. The aggrieved assesse filed an appeal before the Ld.CIT(A) by challenging the impugned penalty order. 3. The Ld.AR took a plea that the quantum addition has been duly set aside by the Ld.CIT(A) for adjudication a fresh; but for penalty order under section 271(1)(c) of the Act was duly confirmed by the Ld.CIT(A). The relevant observations of the Ld.CIT(A) is reproduced below: - “Analysis and decision: 3. I have considered the grounds of appeal and seen the submission/statement made by the appellant and perused the penalty order passed u/s 271(1)(c) of IT Act, 1961. The Appellant has taken grounds which are all related to levying the penalty u/s 271(1)(c) of the IT Act. In this case, the quantum addition has been set aside vide appellate order dated 17.02.2025. Therefore, the grounds of appeal have become infructuous. As such it has become Infructuous, accordingly, this appeal is dismissed. Hence, the grounds of appeal of the appellant are dismissed as infructuous. 4. In the result, the appeal of the appellant is dismissed.” 3 ITA No.3037 /Mum/2025 Shri Kantilal Mohanlal Parekh 4. The Ld.DR relied on the order of revenue authorities, but has not made any strong objection against the submission of the Ld.AR. 5. In our considered view, the quantum appeal was duly remanded by the Ld. CIT(A) to the file of the Ld. Assessing Officer for a fresh assessment. Consequently, the present penalty lacks merit insofar as it pertains to the impugned additions. Accordingly, the appellate order under challenge is set aside. The penalty order is also restored to the file of the Ld. AO, who shall re-examine the issue of penalty, if warranted, upon completion of the reassessment proceedings. 6. In the result, the appeal of the assesse bearing ITA No.3037/Mum/2025 is allowed for statistical purpose. Order pronounced in the open court on 10th day of July, 2025. Sd/- sd/- (SMT. RENU JAUHRI) (ANIKESH BANERJEE) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai, िदनांक/Dated: 10/07/2025 Pavanan Copy of the Order forwarded to: 1. अपीलाथ /The Appellant , 2. ितवादी/ The Respondent. 3. आयकर आयु\u0014 CIT 4. िवभागीय ितिनिध, आय.अपी.अिध., मुबंई/DR, ITAT, Mumbai 5. गाड फाइल/Guard file. BY ORDER, //True Copy// (Asstt. Registrar), ITAT, Mumbai "