LALL CONSTRUCTION CO. ,NEW DELHI V. ACIT, CIRCLE- 34(1), NEW DELHI

ITA 1680/DEL/2018

AI Insights

The case involves M/s Lall Construction Co., the appellant, contesting a penalty of Rs. 21,63,000 upheld by the Commissioner of Income Tax (Appeals) under Section 271(1)(c) for unexplained unsecured loans categorized as unexplained credit under Section 68 of the Income Tax Act, 1961. The Tribunal noted that the quantum addition concerning these unsecured loans was previously addressed in a separate appeal under the Vivad Se Vishwas Scheme, 2024, which was dismissed as withdrawn but allowed for future reinstatement if necessary. Given this context, the Tribunal decided to delete the penalty, subject to the condition that if the main dispute is unresolved and the appellant seeks reinstitution of their appeal, they may also reinstate this penalty appeal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 712480 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2010-2011
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HARPREET KAUR HANSRA
• Assessee Lawyers: SALIL KAPOOR; UTKARSA KUMAR GUPTA
• Keywords: Unexplained cash credit
• Section: 271(1)(c); 68

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: ‘F’: NEW DELHI) BEFORE SHRI S RIFAUR RAHMAN, ACCOUNTANT MEMBER AND SHRI SUDHIR PAREEK, JUDICIAL MEMBER ITA No:- 1680/Del/2018 (Assessment Year- 2010-11) M/s Lall construction Co. AA- 105, Shalimar Bagh, New Delhi-110088. Vs. Asstt. Commissioner of Income Tax, Circle-34(1), New Delhi. PAN No: AACFL0648M APPELLANT RESPONDENT Assessee by : Sh. Salil Kapoor, Adv. & Sh. Utkarsa Kumar Gupta, Adv. Revenue by : Sh. Harpreet Kaur Hansra, Sr. DR Date of Hearing : 09.07.2025 Date of Pronouncement : 31.07.2025 ORDER PER SUDHIR PAREEK, JM: The aforecaptioned appeal has been preferred by the Assessee against the order of Ld. Commissioner of Income Tax (Appeals)- 12, New Delhi ([in short (Ld. CIT(A)] dated 13.11.2017 for A.Y. 2010-11. Printed from counselvise.com ITA No.-1680/Del/2018 Lall ConstrucƟon Co. 2 1.1. The Assessee/appellant has raised the following grounds of appeal for adjudication: “1. On the facts and circumstances of the case, the order passed by the Ld. CIT(A) is erroneous and bad in law. 2. that the Ld. CIT (Appeal) has erred in upholding Penalty u/s 271(1)(c) of Rs. 21,63,000/- on account of Unsecured Loans considering the same as unexplained credit u/s 68 of the I. Tax Act, 1961 without appreciating the facts brought on records during the course of appellate proceedings..” 2. The only issue raised by the assessee in this appeal is against the upholding of penalty levied under Section 271(1)(c) in respect of the addition made on account of unexplained unsecured loans under Section 68 of the Income Tax Act, 1961 (‘the Act’). 3. It is brought to our notice that the quantum addition in respect of the aforesaid unsecured loans has already been disposed of by the coordinate Bench of the Tribunal in assessee’s appeal vide order dated 03.02.2025 passed in ITA No. - 4710/Del/2015 in respect of Vivad Se Vishwas Scheme, 2024 (DTVSV 2024), dismissed as withdrawn subject to a caveat that in case the dispute relating to tax arresrs not resolved, the appellant shall be at liberty to approach the Tribunal for reinstitution of the respective appeal. Printed from counselvise.com ITA No.-1680/Del/2018 Lall ConstrucƟon Co. 3 4. Since the very basis of levy of penalty under Section 271(1)(c) is under settlement as stated above, it is expedient to delete the penalty in question, subject to condition that in case the main dispute could not resolved in aforesaid provision and the appellant preferred to approach the Tribunal as stated hereinbefore for reinstitution the respective appeal, the appellant shall also be at liberty to approach the Tribunal for reinstitution of this appeal and the appeal of the assessee is deserves to be allowed by deleting the penalty levied under section 271(1)(c) on above terms. 6. Consequently, appeal of the assessee is allowed as indicated above. Order pronounced in open court on 31.07.2025 Sd/- Sd/- (S RIFAUR RAHMAN) (SUDHIR PAREEK) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 31/07/2025. Pooja/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT Printed from counselvise.com ITA No.-1680/Del/2018 Lall ConstrucƟon Co. 4 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI Printed from counselvise.com "