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of <h1>Tribunal overturns penalty under Income-tax Act for A.Y. 2008-09</h1> <h3>M/s Metenere Ltd Versus The A.C.I.T Central Circle – 18, New Delhi</h3> M/s Metenere Ltd Versus The A.C.I.T Central Circle – 18, New Delhi - TMI Issues involved:1. Sustaining penalty under section 271(1)(c) of the Income-tax Act, 1961.Detailed analysis:The appeal was filed against the order of the ld. CIT(A) pertaining to A.Y 2008-09, challenging the penalty of Rs. 1,39,15,733 levied under section 271(1)(c) of the Act. The first appellate authority dismissed the appeal in limine, indicating a lack of proper appreciation of facts. The assessment was done under section 143(3) of the Act, with the income computed under different heads, including Business & Profession. The tax liability was calculated under section 115JB of the Act, leading to penalty proceedings under section 271(1)(c) based on additions made in the normal provisions of the Act.The Tribunal observed that no penalty should be levied when income is assessed under section 115JB of the Act, and penalty is imposed on additions made under normal provisions. Citing the decision of the Hon'ble High Court of Delhi in a specific case, it was concluded that the penalty should not be imposed in such scenarios. Additionally, a Circular issued by the CBDT further supported this position, emphasizing that penalties should not be attracted for cases where tax payable on total income computed under normal provisions is less than the tax on book profits under section 115JB of the Act.Based on the settled legal position and the Circular provided, the Tribunal directed the Assessing Officer to delete the penalty amount of Rs. 1,39,15,733. Consequently, the appeal of the assessee was allowed, and the penalty was revoked. The decision was pronounced in the open court on 04.07.2019.
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