SANJAY AGGARWAL V. INCOME TAX OFFICER AND ORS.

W.P.(C)/6914/2023

AI Insights

The case involves Sanjay Aggarwal, the petitioner, who challenged the penalty imposed by the Income Tax Officer for the Assessment Year 2009-10. The initial penalty was levied on 18.03.2014 based on an assessment order from 2011, which included unconfirmed sundry creditors. This penalty was contested and led to various appeals and re-assessments, including a significant reduction in assessed income in a later 2021 order. The core issue was whether the penalty from the 2014 order should continue to apply despite the subsequent re-assessment and reduction of income. The High Court's decision focused on the procedural fairness and the current status of the assessment orders.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 749210 (HC-DELHI)
• Appeal Type: Others
• Pronouncement Date: 22-05-2023
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: KUNAL SHARM A
• Assessee Lawyers: DINESH SINHA; RAJEEV SHARMA
• Keywords: Assessment Year 2009-10; Commissioner of Income Tax (Appeals); Income Tax; Income tax appellate tribunal; Penalty
• Section: 143(3); 271(1)(c); 234B; 234A; 234C; 254

Judgement Text

" W.P.(C) 6914/2023 Page 1 of 4 $~58 * IN THE HIGH COURT OF DELHI AT NEW DELHI % Decision delivered on: 22.05.2023 + W.P.(C) 6914/2023 SANJAY AGGARWAL ..... Petitioner Through: Mr Dinesh Mohan Sinha and Mr Rajeev Kumar Sharma, Advs. versus INCOME TAX OFFICER AND ORS. ..... Respondents Through: Mr Kunal Sharma, Sr Standing Counsel. CORAM: HON'BLE MR. JUSTICE RAJIV SHAKDHER HON'BLE MR. JUSTICE GIRISH KATHPALIA [Physical Hearing/Hybrid Hearing (as per request)] RAJIV SHAKDHER, J. (ORAL): 1. Issue notice. 1.1 Mr Kunal Sharma, learned senior standing counsel, accepts notice on behalf of the respondents/revenue. 2. Given the direction that we propose to issue, Mr Sharma says, that counter-affidavit need not be filed, and that he will argue the matter based on the record presently available with the Court. 2.1 Therefore, with the consent of learned counsel for the parties, the matter is taken up for hearing and final disposal, at this stage itself. 3. This writ petition concerns Assessment Year (AY) 2009-10. 4. The petitioner/assessee has assailed the order dated 26.12.2022 passed by the Income Tax Appellate Tribunal [in short, “Tribunal”]. Digitally Signed By:TARUN RANA Signing Date:21.06.2023 13:49:13 Signature Not Verified W.P.(C) 6914/2023 Page 2 of 4 5. Before the Tribunal, the petitioner/assessee had assailed the order of the Commissioner of Income Tax (Appeals) [in short, “CIT(A)”] dated 29.12.2017. 6. A perusal of the order dated 29.12.2017 passed by the CIT(A) would show, that before him, the petitioner/asseesee had preferred an appeal against the order dated 18.03.2014 passed under Section 271(1)(c) of the Income Tax Act, 1961 [in short, “Act”] concerning the AY in issue. 7. Via order dated 18.03.2014, the Assessing Officer (AO) had levied, on the petitioner, penalty amounting to Rs.27,34,356/-. 8. Notably, before the CIT(A), there was no representation, either on behalf of the petitioner/assessee or the respondents/revenue. 9. The petitioner avers, that the quantum levy imposed on the petitioner via assessment order dated 29.12.2011 was set aside by the Tribunal in the earlier round. 10. It is claimed, that the matter was remanded to the AO. Furthermore, the petitioner avers, that after the remand, the AO passed a fresh order dated 29.06.2021. 10.1 As a result, the petitioner’s assessed income was pegged at Rs.3,21,390/-. This order was passed under Section 143(3) read with Section 254 of the Act. 10.2 Furthermore, the AO has also directed levy of interest under Section234A, 234B and 234C of the Act. 10.3 In addition thereto, penalty proceedings under Section 271(1)(c) of the Act have also been directed to be initiated. Digitally Signed By:TARUN RANA Signing Date:21.06.2023 13:49:13 Signature Not Verified W.P.(C) 6914/2023 Page 3 of 4 11. Insofar as the earlier assessment order dated 29.12.2011 was concerned, the AO had made an addition, with respect to unconfirmed sundry creditors to the extent of Rs.91,82,261/-. The petitioner’s assessed income was pegged at Rs.95,06,940/-. 12. As would be evident, the CIT(A)’s order dated 29.12.2017, which was set aside by the Tribunal via impugned order dated 26.12.2022 arose out of the earlier penalty order dated 18.03.2014, which in turn was founded on the assessment order dated 29.12.2011. 13. It is the contention of Mr Dinesh Mohan Sinha, who appears on behalf of the petitioner, that the Tribunal should not have remanded the matter, as the assessment order dated 29.12.2011 was no longer in existence. 14. Mr Sinha says, that pursuant to the assessment order dated 29.06.2021, up until now, no penalty proceedings have been triggered against the petitioner, although initiation of penalty proceedings were directed via the said order. 15. Given these circumstances, the impugned order is set aside. Consequently, the order dated 18.03.2014 qua penalty proceedingswill collapse. 16. It is, however, made clear that if penalty proceedings are taken out, pursuant to the assessment order dated 29.06.2021, the order passed by us today will not impact the same. 17. The writ petition is disposed of in the aforesaid terms. Digitally Signed By:TARUN RANA Signing Date:21.06.2023 13:49:13 Signature Not Verified W.P.(C) 6914/2023 Page 4 of 4 18. Parties will act based on the digitally signed copy of the order. RAJIV SHAKDHER, J GIRISH KATHPALIA, J MAY 22, 2023/aj Digitally Signed By:TARUN RANA Signing Date:21.06.2023 13:49:13 Signature Not Verified "