2026 (5) TMI 1461

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.... Income-tax Act (hereinafter referred to as the "Act"), dated 02.02.2024, for Assessment Year 2013-14. 2. Grounds taken by the assessee are reproduced as under: 1. On the facts and in the circumstances of the case and in law, the Ld. Commissioner of Income Tax (Appeals) has erred in partly confirming the penalty levied under section 271(1)(c) of the Income-tax Act, 1961, amounting to penalty relatable to additions of Rs. 8,39,252/- (tenancy rights) and Rs. 81,898/- (interest income). 2. On the facts and in the circumstances of the case, the Ld. Commissioner of Income Tax (Appeals) failed to appreciate that the penalty proceedings are distinct from assessment proceedings and mere acceptance or withdrawal of quantum appea....

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....) exceeded his appellate jurisdiction in confirming the penalty on issues for which no clear and specific satisfaction was recorded by the Assessing Officer. By sustaining penalty on selected additions, the Ld. CIT(A) effectively assumed the role of the Assessing Officer, which is impermissible under the scheme of the Act. 3. By the present appeal, assessee is contesting levy of penalty u/s. 271(1)(c) amounting to Rs. 6,50,000/- on addition made of Rs. 8,39,252/- in respect of tenancy rights u/s. 50C and on Rs. 81,898/- in respect of interest earned on FDs. Fact of the case are that assessee filed return of income on 31.07.2013, reporting total income at Rs. 3,56,496/-. Assessment was completed u/s. 143(3) whereby total income was assess....

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....uently, impugned penalty order u/s. 271(1)(c) was passed, dated 02.02.2024, levying penalty of Rs. 6,50,000/- on the additions made in the course of assessment. Against the imposition of the said penalty, matter went into first appeal, whereby penalty on addition made in respect of long term capital gain on sale of property u/s. 50C was deleted for which ld. CIT(A) held that this addition was purely on account of deeming fiction and that the said valuation was supported by the valuation done by the ld. DVO. However, penalty on the two other additions in respect of long term capital gain on tenancy rights u/s. 50C and interest income on FDs was confirmed. Assessee is in appeal before the Tribunal in respect of the penalty confirmed for the t....