Mohd Khalid vs Assessment Unit, Income Tax Department, Income Tax Officer-1(5)

PER AMITABH SHUKLA, AM

This appeal filed by the assessee is directed against the separate order of Ld. Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre, New Delhi, dated 11.03.2026, arising out of penalty order dated 01.09.2023 passed under section u/s 271AAC(1) of the Act for the Assessment Year 2018-19. The word ‘Act’ herein this order would mean Income Tax Act, 1961.

At the outset, ld. Counsel for the assessee submitted that this tribunal has decided the quantum appeal in favour of the appellant in terms of their order in ITA No.3874/Del/2026, dated 25.06.2026 by setting aside the issue for afresh re-adjudication by the ld. CIT(A) and that therefore the present appeal which is contesting the penalty u/s 271AAC deserves to be allowed in assessee’s favour.

The ld. DR concurred with the arguments of the appellant and did not object to the proposal.

We have heard rival submissions in the light of material placed on records. It is trite law that no penalty survives once quantum addition is absent. In the present case, the quantum stands remitted back to ld. CIT(A) for re-adjudication de novo. Accordingly, we set-aside the order of ld. CIT(A) confirming penalty imposed u/s 271AAC by the ld. Assessing Officer vide his order dated 01.09.2023 and remit the matter back to ld. CIT(A) for re-adjudication de novo. The ground of appeal raised by the assessee is therefore allowed for statistical purposes.

In the result, the appeal of the assessee is allowed for statistical purposes.

Order pronounced in the open court on 29^th July, 2026.