ITAT’s Deletion of Addition Invalidates related Section 271(1)(c) Penalty

Raj Auto Wheels Pvt. Ltd. Vs DCIT (ITAT Jaipur)

ITAT’s Deletion of Addition Invalidates related Section 271(1)(c) Penalty – Raj Auto Wheels Pvt. Ltd. Vs DCIT (ITAT Jaipur)

Introduction: In a recent decision, the Income Tax Appellate Tribunal (ITAT) in Jaipur, in the case of Raj Auto Wheels Pvt. Ltd. vs. DCIT, addressed the issue of penalty under Section 271(1)(c) of the Income Tax Act, 1961. The ITAT’s order, dated 26th September 2023, highlights the significance of the deletion of additions in the quantum assessment process in determining the validity of related penalties.

Background:

Raj Auto Wheels Pvt. Ltd., a Maruti Suzuki dealer in Ajmer District, filed its return of income for the assessment years 2010-11 and 2011-12. The Assessing Officer (AO) completed the assessment, making additions and disallowances, and initiated penalty proceedings under Section 271(1)(c) of the Act.

Please become a Premium member. If you are already a Premium member, login here to access the full content.