T.C. HEALTHCARE PVT LTD,MEERUT V. ITO WARD-25(1), DELHI

ITA 3957/DEL/2025

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The case involves M/s T.C. Healthcare Pvt. Ltd., which appealed against the penalties imposed by the Income Tax Officer under section 271(1)(c) related to disallowances made under the heads of gifts/presentation expenses and excise duty. The penalties amounted to Rs. 4,86,860 and Rs. 20,080 respectively. The Tribunal reviewed the assessments and the explanations provided by the assessee, which were consistently rejected by the lower authorities. However, referencing the Supreme Court's decision in CIT vs Reliance Petroproducts, the Tribunal concluded that the mere disallowance of expenses does not automatically lead to penalties under section 271(1)(c).

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 788189 (ITAT-DELHI)
• Duration Of Justice: 5 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-11-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: misc
• Appeal Filed On: 17-06-2025
• Other Referred Cases: CIT vs Reliance Petroproducts (P.) Ltd. [2010] 322 ITR 158 (SC)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANISH GUPTA
• Assessee Lawyers: PREMJIT S. KASHYAP
• Keywords: Gift
• Section: 271(1)(c)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH, ‘G’: NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI MANISH AGARWAL, ACCOUNTNAT MEMBER ITA No.3957/Del/2025 [Assessment Years:2016-17] M/s T.C. Healthcare Pvt. Ltd. C/o-Kashyap & Co. 114/214, Citi Centre, Begum Bridge Road, Meerut, Uttar Pradesh-250001 Vs Income Tax Officer, Ward- 25(1), C.R. Building, ITO, IP Estate, New Delhi-110002 PAN-AAACT3701G Appellant Respondent Appellant by Shri Premjit S. Kashyap, FCA Respondent by Shri Manish Gupta, Sr. DR Date of Hearing 17.11.2025 Date of Pronouncement 17.11.2025 ORDER PER SATBEER SINGH GODARA, JM This assessee’s appeal for Assessment Year 2016-17 arises against National Faceless Appeal Centre/Commissioner of Income Tax (Appeals)[in short the “CIT(A)”], New Delhi’s order dated 13.05.2025 passed in Case No. NFAC/2015-16/10125861 Printed from counselvise.com 2 ITA No.3957/Del/2025 involving proceedings under section 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’). Heard both the parties. Case file perused. 2. Coming to the assessee’s sole substantive ground challenging both the lower authority’s action imposing section 271(1)(c) penalty(ies) amounting to Rs.4,86,860/- and 20,080/- relating to as many quantum disallowance is under the head gifts/presentation expenses and penalty paid on excise duty, respectively, it transpires at the outset during the course of hearing that the Assessing Officer had framed his assessment on 26.12.2018 to this effect which stood upheld in the CIT(A)’s lower appellate discussion. The matter then travelled to this Tribunal, wherein, the above latter issue of penalty payment on excise duty stood restricted to Rs.64,360/- than that in the earlier round amounting to Rs.1,26,696/-. 3. It is in this background that both the learned lower authorities have held the assessee to have concealed and furnished its inaccurate particulars of income to levy section 271(1)(c) penalty. The Revenue could hardly dispute that both the impugned quantum disallowances have been made after rejecting the assessee’s detailed explanation all along which Printed from counselvise.com 3 ITA No.3957/Del/2025 could not be either termed as an instance of concealment or furnishing of inaccurate particulars of income as per the lordships land mark decision in CIT vs Reliance Petroproducts (P.) Ltd. [2010] 322 ITR 158 (SC). Hon’ble Apex Court has further settled the issue that quantum and penalty are separate proceedings wherein each and every disallowance/additions made in course of former does not automatically result in invocation of the latter provision. We thus find merit in the assessee’s instant sole substantive ground to delete the impugned penalty in very terms. 4. The assessee’s appeal is allowed. Order pronounced in the open court on 17th November, 2025. Sd/- Sd/- [MANISH AGARWAL] [SATBEER SINGH GODARA] ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 17.11.2025 f{x~{tÜ f{x~{tÜ f{x~{tÜ f{x~{tÜ Copy forwarded to: 1. Appellant 2. Respondent 3. PCIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi, Printed from counselvise.com "