AI Structured Summary
Not yet generated for this judgment
Judgment
PER MANISH AGARWAL, AM:
Both the appeals are filed by the respective assessee against the separate orders of Ld. Commissioner of Income Tax (Appeals)-24 New Delhi [“Ld. CIT(A)”] passed u/s 250 of the Income Tax Act, 1961 [“the Act”] both dt. 13.02.2026 arising out of the separate penalty orders both dated 28.06.2023 passed u/s 271AAC(1) of the Income Tax Act, 1961 [‘the Act’ in short] for Assessment Year 2018-19.
Heard both the parties and perused the materials available on record. It is observed that the penalty proceedings u/s 271AAC(1) were initiated in the assessment orders passed u/s 153C of the Act dated 31.12.2022 in both the cases wherein total addition of Rs.42,94,000/- was made in the hands of the assessee Shri Vivek Sahgal and of Rs.42,94,000/- was made in the hands of Smt. Rachita Sehgal. Thereafter the AO proceeded to complete the pending penalty proceedings initiated and as per the orders passed u/s 271AAC(1) of the Act dated 28.06.2023 levied the penalty Rs.3,31712/- u/s 271AAC(1) in the hands of both the assessee by way of separate orders passed.
At the outset, it is observed that the orders passed u/s 153C of the Act dated 31.12.2022 were challenged by both the assessee before the Tribunal wherein the Co-ordinate Bench ‘E’ of ITAT, Delhi vide its order dated 07.02.2025 in ITA No.1836/Del/2023 and ITA No.1888/Del/2023 has deleted the entire additions made. The relevant observations of the coordinate bench are reproduced as under:
“5.Next comes merits of the impugned on-money addition wherein the department vehemently quotes section 292C of the Act qua the above seized material Exhibit-13. We are of the considered view that such a presumption u/s 292C of the Act applies only against the person from whom the corresponding Incriminating material has been found and seized than a third person and therefore, the impugned addition without any supportive evidence or corroboration does not deserve to be upheld on merits as well. Deleted accordingly.”
Since the very basis of levy of penalty i.e. the additions have already been deleted by the Co-ordinate Bench of Tribunal, and there is no income on which penalty could be levied u/s 271AAC(1) and, therefore, the penalty levied is hereby deleted in both the cases.
In the result, the appeals filed by both the assessee are allowed.