Case Number: ITA 5448/DEL/2019
Appellant: Arun Duggal, New Delhi
Respondent: ACIT, Central Circle- 4, New Delhi
Assessment Year: 2010-11
Result: Final Tribunal Order
Case Filed on: 2019-06-19
Date of Order: 2022-04-29
Pronounced on: 2022-04-29
The case of Arun Duggal vs. ACIT Central Circle 4, New Delhi pertains to the assessment year 2010-11. The primary issue in this case was the inaccurate reporting of income and unexplained credits in the appellant’s bank account, which led to significant penalties and subsequent appeals.
On 30.12.2017, the Assessing Officer (AO) passed an assessment order under section 153A of the Income-tax Act, 1961, determining the total income of Arun Duggal at Rs. 13,62,32,600/- as against the returned income of Rs. 5,14,140/-. This discrepancy was primarily due to unexplained credit entries in Arun Duggal’s bank account.
Aggrieved by this assessment order, Arun Duggal preferred a first appeal before the Commissioner of Income-tax (Appeals)-23, New Delhi. The Commissioner, in his order dated 30.12.2018, further enhanced the income by Rs. 2,12,25,000/-, attributing it to unexplained credits for the assessment year under consideration. Additionally, the Commissioner initiated penalty proceedings under section 271(1)(c) of the Income-tax Act for furnishing inaccurate particulars of income and concealing particulars of income.
The Commissioner, while passing the impugned order under section 271(1)(c) of the Income-tax Act, imposed a penalty of Rs. 4,30,74,854/- at 125% of the quantum of income allegedly sought to be evaded. Arun Duggal, dissatisfied with this decision, appealed against the penalty orders.
During the Tribunal hearing, Arun Duggal’s representative, Shri Kapil Goel, argued that the quantum appeal (ITA No. 1819/Del/2019) had already been allowed by the Tribunal on 19.01.2021. This order deleted the additions on the basis of which the penalties were imposed.
The Tribunal, comprising Shri R.K. Panda, Accountant Member, and Shri N.K. Choudhry, Judicial Member, considered the facts and circumstances of the case. It was noted that the quantum additions had been deleted by the Tribunal, and therefore, the basis for imposing penalties no longer existed. Citing the decision in K.C. Builders vs. ACIT, the Tribunal held that when the additions on which penalties were based are deleted, the penalties cannot stand.
In light of these observations, the Tribunal deleted the penalties imposed on Arun Duggal for the assessment year 2010-11. The appeal was thus allowed.
Order pronounced in the open court on 29/04/2022.
Signatories:
R.K. Panda, Accountant Member
N.K. Choudhry, Judicial Member
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