Tribunal Upholds Cancellation of Tax Penalty for 2009-10; Revenue's Appeal and Assessee's Objection Dismissed.

The ITAT dismissed the Revenue's appeal and the assessee's cross objection concerning the penalty imposed under Section 271(1)(c) of the Income Tax Act, 1961, for the Assessment Year 2009-10. The Tribunal upheld the CIT(A)'s decision to cancel the penalty related to the disallowance of future and option loss, as the underlying issue was pending before the Assessing Officer. The cross objection was deemed infructuous, and both the appeal and the cross objection were dismissed on December 10, 2018, in Ahmedabad.

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Issues involved: Appeal against deletion of penalty u/s 271(1)(c) of the Income Tax Act, 1961 by ld. CIT(A) for the Asstt. Year 2009-10.

Summary:
1. The Revenue appealed to the Tribunal against the deletion of a penalty of Rs. 26,39,116/- imposed by the Assessing Officer u/s 271(1)(c) for the Asstt. Year 2009-10.
2. The Assessing Officer had made additions to the total income of the assessee, including STCG, LTCG, future & option loss, and administrative expenses.
3. The ld. CIT(A) deleted the penalties related to STCG and LTCG, but confirmed the disallowance of future & option loss. Both Revenue and assessee appealed to the ITAT against these decisions.
4. The penalty u/s 271(1)(c) was imposed by the Assessing Officer for the disallowance of future & option loss. However, the Tribunal set aside this issue for fresh adjudication.
5. The Tribunal held that since the issue on which the penalty was imposed was pending before the Assessing Officer, the penalty was not sustainable. The ld. CIT(A) cancelled the penalty, which was upheld by the Tribunal.
6. The cross objection (CO) of the assessee supported the ld. CIT(A)'s order and did not raise any new grievances. It was dismissed as infructuous.
7. The appeal of the Revenue and the CO of the assessee were both dismissed by the Tribunal on 10th December, 2018 at Ahmedabad.

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