Assessee challenges the intention of penalty proceedings u/s 271(1)(c)

Last updated: 11 October 2021

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The Income Tax Appellate Tribunal has allowed the appeal of S.D. Constructions, a firm engaged in building construction. The assessee had challenged a penalty imposed under Section 271(1)(c) of the Act, which had been confirmed by the Ld. CIT(A). The Tribunal's decision was based on the applicability of previous rulings from the Coordinate Bench and the Karnataka High Court.

Court :
ITAT Kolkata

Brief :
This appeal filed by the assessee is directed against the order of Ld. CIT(A) – 15, Kolkata dated 30.07.2019 whereby he confirmed the penalty of Rs.4,58,376/- imposed by the AO u/s 271(1)(c) of the Income tax Act, 1961.

Citation :
I.T.A. No. 243/Kol/2021

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH ‘(A)’, KOLKATA
[BEFORE SHRI P.M. JAGTAP, HON’BLE VICE PRESIDENT (KZ) &
SHRI A. T. VARKEY, HON’BLE JUDICIAL MEMBER]
[Through Virtual Court]
I.T.A. No. 243/Kol/2021
Assessment Year: 2015-16

S. D. Constructions

Appellant
C/o Subash Agarwal &
Associates, Advocates Siddha Gibson,
1, Gibson Lane, Suite 213,
2nd Floor,
Kolkata-700069.
[PAN: AAWFS5599N]

ACIT, Circle-49(1), Kolkata

Respondent

Appearances by:
Shri Subash Agarwal, Advocate, appearing on behalf of the Assessee.
Smt. Ranu Biswas, Addl. CIT, appearing on behalf of the Revenue.
Date of concluding the hearing : September 29, 2021
Date of pronouncing the order : October 01, 2021

ORDER

The assessee, in the present case, is a firm and is engaged in the business of construction of building. The return of income for the year under consideration was filed by the assessee on 29.09.2015 declaring a total income of Rs.38,97,950/-.

2. The penalty imposed by the AO u/s 271(1)(c) was challenged by the assessee in the appeal filed before the Ld. CIT(A) and since the contention raised on behalf of the assessee in support of its case were not found acceptable by the Ld. CIT(A), he confirmed the penalty imposed u/s 271(1)(c) of the Act.

3. In our opinion, the decision of the Coordinate Bench of this Tribunal rendered in the case of Suvaprasanna Bhattacharya –vs.- ACIT rendered vide its order dated 06.11.2015 in ITA No. 1303/KOL/2010 by relying on the decision of the Hon’ble Karnataka High Court in the case of CIT & Another –vs.- Manjunatha Cotton & Ginning Factory reported in 359 ITR 565 is squarely applicable in the present case.

4. In the result, the appeal of the assessee is allowed.
Order Pronounced in the Open Court on 1st October, 2021.

Please find attached the enclosed file for the full judgement

FAQ :

The main issue was the assessee challenging the intention behind the penalty proceedings initiated under Section 271(1)(c) of the Income Tax Act.

The appellant was S.D. Constructions, and the respondent was the ACIT, Circle-49(1), Kolkata.

The appeal of the assessee was allowed by the Income Tax Appellate Tribunal.

The Tribunal allowed the appeal by relying on decisions from a Coordinate Bench in the case of Suvaprasanna Bhattacharya and the Karnataka High Court in the case of CIT & Another vs. Manjunatha Cotton & Ginning Factory.

The assessment year under consideration was 2015-16.