ITAT quashed penalty as AO did not record satisfaction for initiating penalty
ITAT quashed penalty as AO did not record satisfaction for initiating penalty
Meerut Agrochemical Industries Ltd filed return of income and assessment was completed after making addition of Rs 11,97,891. Penalty proceedings u/s 271(1)(c) (of Income Tax Act, 1961) were initiated. AO levied a penalty of Rs 3,90,400 u/s 271(1)(c) (of Income Tax Act, 1961). CIT(A) dismissed the appeal of the assessee. ITAT quashed penalty as Assessing Authority did not record his satisfaction for initiating penalty proceedings in the assessment order.-501662
1. Assessee filed return of income and assessment was completed at assessed income of Rs. 13,05,491 after making addition of Rs. 11,97,891,
2. Penalty proceedings u/s 271(1)(c) (of Income Tax Act, 1961) were initiated.
3. AO levied a penalty of Rs. 3,90,400 u/s 271(1)(c) (of Income Tax Act, 1961).
4. CIT(A) dismissed the appeal of the assessee.
On appeal the ITAT held as under:
5. We further find that at the threshold condition for imposition of penalty u/s 271(1)(c) (of Income Tax Act, 1961) is formation of opinion and recording of satisfaction before conclusion of the proceedings and not at the time of issuance of notice or intimation of penalty proceedings.
6. Whereas in the present case, the Assessing Authority did not record his satisfaction for initiating penalty proceedings in the assessment order
7. In the background of the aforesaid discussions, respectfully following the precedents, as aforesaid we are of the view that the levy of penalty in this case is not justified.
Case Reference - M/s Meerut Agro Chemical Industries Ltd. Vs ACIT.
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: 'C' NEW DELHI
BEFORE SHRI H. S. SIDHU, JUDICIAL MEMBER AND
SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER
I.T.A. No. 2476/Del/2015
(Assessment Year: 2004-05)
×
