KANVAR CORPORATION,DELHI V. DCIT,CIRCLE-50(1), DELHI

ITA 1683/DEL/2025

AI Insights

The case involves Kanvar Corporation appealing against the order of the Commissioner of Income-tax (Appeals), NFAC, Delhi, which sustained a penalty levied by the Assessing Officer (AO) under section 270A of the Income Tax Act. The penalty was based on the misreporting of income related to sundry creditors, which were found not to exist as there were no confirmations. The tribunal noted that the assessee had not challenged the quantum addition but only the penalty. The tribunal found that the CIT(A) did not examine the issues concerning the nature of disallowance in relation to the penalty under section 270A, leading to the remand of the case for a fresh decision on these merits.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 785216 (ITAT-DELHI)
• Duration Of Justice: 7 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-10-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2017-2018
• Appeal Filed On: 20-03-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Matter Remanded
• Court: TRIBUNAL
• Department Lawyers: SUSHIL KUMAR KULHERI
• Keywords: Set aside

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES: G : NEW DELHI BEFORE SHRI ANUBHAV SHARMA, JUDICIAL MEMBER AND SHRI NAVEEN CHANDRA, ACCOUNTANT MEMBER ITA No.1683/Del/2025 Assessment Year: 2017-18 Kanvar Corporation, A-26, Basement and Ground Floor, Naraina Industrial Area, New Delhi – 110 028. PAN: AALFK6427E Vs DCIT, Circle-50(1), New Delhi. (Appellants) (Respondents) Assessee by : None Revenue by : Shri Sushil Kumar Kulheri, Sr. DR Date of Hearing : 01.10.2025 Date of Pronouncement : 29.10.2025 ORDER PER ANUBHAV SHARMA, JM: This appeal is preferred by the assessee against the order dated 06.02.2025 of the Commissioner of Income-tax (Appeals), NFAC, Delhi (hereinafter referred as Ld. First Appellate Authority or in short Ld. ‘FAA’) in appeal No.NFAC/2016-17/10066962 arising out of the appeal before it against the order dated 21.12.2021 passed u/s 270A of the Income Tax Act, Printed from counselvise.com ITA No.1683/Del/2025 2 1961 (hereinafter referred as ‘the Act’) by the AO, NaFAC (hereinafter referred to as the Ld. AO). 2. None appeared at the time of hearing though notices have been issued earlier in ordinary course and when issued by RPAD, notice has been received back with the report, ‘there is no such person.’ Thus, no further notices are justified. 3. The ld. DR was heard and record was perused. 4. We find that the assessee had declared income at Rs.1,37,72,800/- and, after scrutiny assessment, addition of Rs.6,85,247/- was made on account of disallowance of sundry creditors which led to initiation of proceedings for misreporting the income and the AO had found that the alleged sundry creditors were not in existence as there was no confirmation. The assessee had not challenged the quantum addition and merely approached challenging the levy of penalty which has been sustained by the impugned order wherein it was observed that the assessee had failed to appear for five years in the tax proceedings. However, there is no findings of NFAC on merits to show that the issues giving rise to levy of penalty u/s 270A were examined in the context of nature of disallowance and would the nature of disallowance on account of sundry creditors should result into levy Printed from counselvise.com ITA No.1683/Del/2025 3 of penalty u/s 270A. Accordingly, we set aside the impugned order to the files of the CIT(A) to pass the order afresh on merits. The appeal is allowed for statistical purposes. Order pronounced in the open court on 29.10.2025. Sd/- Sd/- (NAVEEN CHANDRA) (ANUBHAV SHARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: October, 2025. dk Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asstt. Registrar, ITAT, New Delhi Printed from counselvise.com "