A division bench of the Delhi High Court comprising Justice Manmohan and Justice Dinesh Kumar Sharma has held that the penalty under Section 271(1)(c) of the Income Tax Act, 1961 if concealment of income is not proven and the quantum order is quashed by the appellate authority.
The assessee approached the High Court stating that the charging of interest under Section 234B of the Income Tax Act, 1961 is consequential and mandatory. He contended that since the Assessing Officer in the original assessment order dated 29th
Upon perusal of the impugned order, the Court found that “in the impugned order, the Tribunal has relied upon the judgment passed by this Court in Director of Income Tax vs. Jacabs Civil Incorporated (2011) 330 December, 2008 had given a specific direction to charge interest, non-levy of interest under Section 234B of the Act while computing tax demand was a mistake apparent on the record and was therefore rectifiable under the provisions of Section 154 of the Income Tax Act.”
“This Court is also in agreement with the opinion of the Tribunal that the penalty can only be levied in such cases where concealment of income has been proven. If the quantum order itself has been set aside in an appeal preferred by the respondent/assessee, there is no question of penalty being levied,” the Court said.
COMMISSIONER OF INCOME TAX (INTERNATIONAL TAXATION)-2 vs GRACEMAC CORPORATION
CITATION: 2022 TAXSCAN (HC) 211
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