2021 (4) TMI 816

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....o without assuming jurisdiction as per law and the impugned penalty order being illegal and void ab-initio and without considering the submissions of assessee and without observing the principles of natural justice. 2. That in any case and in any view of the matter, action of Ld. Pr.CIT in imposing penalty of Rs. 33,62,420/- u/s 271(l)(c) and that too @ 200%, is bad in law and against the facts and circumstances of the case. 3. That having regard to the facts and circumstances of the case, Ld. Pr.CIT has erred in law and on facts in imposing penalty u/s 271(l)(c) of Rs. 33,62,420/- and that too without recording mandatory "satisfaction" as per law. Additional grounds of appeal 1. "That having regard to the facts and circumstance....

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....er of Rs. 1,69,62,106/- as the same is collusive in nature relating to transaction of sale of machinery, claim of depreciation of Rs. 28,23,005/- along with loss of Rs. 49,46,196/- debited to profit and loss account on sale of plant and machinery, claim of financial charges, unsecured loan of Rs. 30 lac Sundry Creditors of Rs. 7,16,533/- and possession of TDS of freight of Rs. 6,93,425/-. Consequently, the assessment order u/s 263/143(3) was passed by the Assessing Officer on 28/3/2014 on total income of Rs. 95,10,830/-. Penalty notice u/s 271(1)(c) was also issued on 18/3/2013. In the meanwhile, the assessee went in appeal before the Tribunal against the order u/s 263 and the Tribunal vide order dated 18/11/2016 in ITA No. 2055/Del/2013 di....

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.... Ltd, ITA 475/2019, 426-427/2019 and 429/2019, dated 02.08.2019 (Del HC) d) Pr. CIT vs. Smt. Baiseity Revathi, I.T.T.A No. 684/2016, dated 13/07/2017 (AP HC) e) Meherjee Cassinath Holdings Pvt. Ltd. vs. ACIT, ITA No. 2555/Mum/2012, dated 28.04.2017 (Mum Tri.) f) Bhushan Uttamrao Bachchav vs. ITO, ITA No. 989/Pun/2017, dated 09.07.2019 (Pune Tri.) g) Shri Phool Singh vs. ITO, ITA No. 744/Del/2016, dated 03.05.2018 (Del Tri.) The Ld. AR further submitted that even penalty order of Pr. CIT dated 25.07.2017 in para 13 sought to impose penalty for both the charges, which is bad in law as held in the following judicial decisions: * New Sorathia Engineering Co. vs. CIT, (2006) 282 ITR 0642 (Guj) * CIT vs. Manjunatha Cotton and G....

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....here is no reason furnished for imposing penalty of 200%. 6. The Ld. DR relied upon the penalty order and submitted that the Commissioner of Income Tax has rightly imposed penalty as per the provisions of Section 271(1)(c). The Ld. DR further submitted that the penalty order with respect to addition of Rs. 49,46,196/- was made on account of wrong claim of loss on sale of plant and machinery to the total income of the assessee vide order u/s 263 dated 18.03.2013 issued by the CIT. The said addition was sustained by the Tribunal vide order dated 18.11.2016 in ITA No. 2055/Del/2013. Subsequently to the said order of the Tribunal, penalty order dated 25.07.2017 was passed by the CIT imposing penalty of Rs. 33,62,420/- under Section 271(1)(c). ....

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....eal before the Tribunal against the order u/s 263 of the CIT, the penalty order was passed rightly by the CIT after the order of the Tribunal and the said order was passed before the end of six months as laid down in Section 275(1)(a). The Ld. DR further submitted that the contention of the Ld. AR that as per Section 275(1)(b), penalty order was to be passed by the CIT before the expiry of six months from the end of the month in which such order of revision under Section 263 is passed and thus, the same is barred by limitation, is not justified as there was appeal filed by the assessee against the order u/s 263 and the Circular No. 7 of 2003 dated 05.09.2003 relied upon by the Ld. AR does not have any bearing on the present case. The Ld. DR....

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....me amount. He drew our attention to the fact that the entire loss claimed by the assessee has been disallowed by the AO and the profit of Rs. 8,48,105/- has been brought to tax on account of estimation of business profit. The aforesaid amount of Rs. 49,46,196/- was part of the business loss claimed by the assessee and once that loss is disallowed, and estimated net profit is assessed as income; the aforesaid amount of Rs. 49,46,196/- stands disallowed automatically. Therefore, the Ld. Counsel for the assessee submitted that there was no justification for once again making repeated addition on the aforesaid amount of Rs. 49,46,196/- in the Assessment Order. The Ld. DR agreed that the repeated addition made by the AO in respect of the aforesa....