Tribunal upholds cancellation of penalty for deemed dividend - Section 271(1)(c) not satisfied

The Tribunal dismissed the Revenue's appeal challenging the deletion of penalty u/s.271(1)(c) for A.Y. 2000-01 based on deemed dividend u/s.2(22)(e) on 30th May, 2012. The Tribunal upheld the decision of the Ld. CIT(A) to cancel the penalty, citing that the conditions under u/s.271(1)(c) were not satisfied in this case, as supported by a similar precedent involving deeming provisions of sec.2(22)(e).

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Issues involved: Challenge to deletion of penalty u/s.271(1)(c) for A.Y. 2000-01 based on deemed dividend u/s.2(22)(e).

Summary:
The Revenue challenged the deletion of penalty u/s.271(1)(c) by Ld. CIT(A) for the A.Y. 2000-01, arising from the assessment order finding a borrowal of Rs.2,27,43,654/- treated as deemed dividend u/s.2(22)(e). The penalty was imposed on the concealment of this deemed dividend, which the assessee contested by explaining the circumstances. Ld. CIT(A) held that the conditions u/s.271(1)(c) were not met, canceling the penalty. The Revenue argued for upholding the penalty, while the counsel supported Ld. CIT(A)'s decision. The Tribunal dismissed the appeal, citing a similar case where the penalty was canceled based on deeming provisions of sec.2(22)(e), concluding it was not a case for penalty u/s.271(1)(c) of the I.T. Act.

In conclusion, the appeal filed by the Revenue challenging the deletion of penalty u/s.271(1)(c) for A.Y. 2000-01 based on deemed dividend u/s.2(22)(e) was dismissed by the Tribunal on 30th May, 2012.

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