Penalty proceedings u/s. 271(1)(c) against non-existent entity untenable: Calcutta HC

PCIT Vs Chandravadan Desai (HUF) (Calcutta High Court) Calcutta High Court held that initiation of penalty proceedings under section 271(1)(c) of the Income Tax Act and passing of penalty order thereof in the name of a non-existent entity (i.e. dissolved HUF) is liable to be quashed. Accordingly, appeal of revenue dismissed. Facts- AO completed the assessment for the assessment year under consideration u/s. 143(3) of the Act by order dated 30.12.2016. While completing the assessment, an addition of Rs.7,29,59,117/- was made on the ground of disallowance of capital loss on dissolution of the HU...