Income Tax Appellate Tribunal - Mumbai
Kumar Agro Products, Mumbai vs Dy. Cit 1 (2), Mumbai on 19 April, 2021
1 आयकर अपीलीय अधिकरण "एच" न्यायपीठ मुंबई में। IN THE INCOME TAX APPELLATE TRIBUNAL "H" BENCH, MUMBAI माननीय श्री महावीर स िंह, उपाध्यक्ष एवुं माननीय श्री मनोज कुमार अग्रवाल ,लेखा दस्य के मक्ष। BEFORE HON'BLE SHRI MAHAVIR SINGH, VP AND HON'BLE SHRI MANOJ KUMAR AGGARWAL, AM (Hearing Through Video Conferencing Mode) आयकरअपील िं ./ I.T.A. No.6495/Mum/201 9 (धििाारण वर्ा / Assessment Year: 2001-02) Kumar Agro Products DCIT-1(2) 21, W oudby Road 535/537, Aaykar Bhawan Hajarimal Somany Marg बिाम/ M.K.Road Opp. Bombay Gymkhana Vs. Mumbai - 400 020 BDA Trust Compound Fort, Mumbai -400 001 स्थायीलेखा िं ./ जीआइआर िं ./ PAN/GIR No. AAACK-7660-H (अपीलाथी/Appellant) : (प्रत्यथी / Respondent) Assessee by : Shri Nikhil Tiwari-Ld. AR Revenue by : Shri Gurbinder Singh-Ld. DR ुनवाई की तारीख/ : 19/04/2021 Date of Hearing घोषणा की तारीख / : 19/04/2021 Date of Pronouncement आदे श / O R D E R Manoj Kumar Aggarwal (Accountant Member)
1. In the captioned appeal, the assessee assails penalty u/s 271(1)(c) as confirmed by learned first appellate authority vide impugned order dated 20/08/2019. The Ld. AR, Shri Nikhil Tiwari, submitted that the assessee has already opted for settlement of dispute for quantum additions as well as penalty under Direct Tax Vivad Se Vishwas Scheme (VVS Scheme), 2020 and already received Form No.3 from appropriate 2 authority. The copy of the same has been placed on record. The attention has been drawn to the fact that quantum appeal ITA No.2170/Mum/2019 has already been allowed to be withdrawn by the Tribunal vide order dated 31/12/2020. It was, therefore, submitted that the impugned penalty would not survive against the assessee.
2. To support the same, the Ld. AR drew attention to CBDT Circular No. 9 of 2020 dated 22.04.2020 wherein while giving answer to FAQ no. 8, the CBDT has clarified that it would not be possible for the taxpayer to apply for settlement of penalty appeal only, when the appeal on disputed tax related to such penalty is still pending. In the instant case, since appeal against quantum assessment order is already settled as stated above, the impugned appeal for levy of penalty needs to be disposed off and penalty proceedings u/s 271(1)(c) of the Act should be dropped.
3. We have carefully considered the rival arguments. At the outset, the relevant FAQ No. 8 as referred to by Ld. AR is reproduced as under:-
"Q8. Imagine a case where an appellant desires to settle concealment penalty appeal pending before CIT(A), while continuing to litigate quantum appeal that has travelled to higher appellate forum. Considering these are two independent and different appeals, whether appellant can settle one to exclusion of others? If yes, whether settlement of penalty appeal will have any impact on quantum appeal? Ans: If both quantum appeal covering disputed tax and appeal against penalty levied on such disputed tax for an assessment year are pending, the declarant is required to file a declaration form giving details of both disputed tax appeal and penalty appeal. However, he would be required to pay relevant percentage of disputed tax only. Further, it would not be possible for the appellant to apply for settlement of penalty appeal only when the appeal on disputed tax related to such penalty is still pending."
Keeping in view the provisions of section 3 of the VSV Act and FAQ No. 8 as extracted above, it is quite discernible that when the tax arrears include penalty levied on such disputed tax, then in such a case only prescribed percentage of disputed tax is required to be paid by the 3 declarant. Upon perusal for Form No.3, we find that the assessee has filed declaration for both the appeals i.e. disputed tax appeal as well as penalty appeal and paid prescribed percentage as per the scheme. Since the quantum appeal as well as penalty appeal has been settled by the assessee on payment of disputed tax, the captioned appeal which is in relation to penalty u/s 271(1)(c) does not survive for adjudication and the penalty would stand deleted. We order so.
4. The appeal stand allowed in terms of our above order.
Order pronounced on 19th April, 2021.
Sd/- sd/- (Mahavir Singh) (Manoj Kumar Aggarwal) उपाध्यक्ष / Vice President लेखा दस्य / Accountant Member
मुिंबई Mumbai; सदनािं क Dated : 19.04.2021 Sr.PS, Jaisy Varghese आदे शकीप्रधिधलधपअग्रेधर्ि/Copy of the Order forwarded to :
1. अपीलाथी/ The Appellant
2. प्रत्यथी/ The Respondent
3. आयकरआयुक्त(अपील) / The CIT(A)
4. आयकरआयुक्त/ CIT- concerned
5. सवभागीयप्रसतसनसध, आयकरअपीलीयअसधकरण, मुिंबई/ DR, ITAT, Mumbai
6. गार्ड फाईल / Guard File आदे शािसार/ BY ORDER, उप/सहायक पुंजीकार (Dy./Asstt.Registrar) आयकरअपीलीयअधिकरण, मुिंबई / ITAT, Mumbai.