Case Law Details
PCIT Vs Gopal Kumar Goyal (Delhi High Court)
Introduction: The Delhi High Court’s recent judgment in the case of PCIT vs Gopal Kumar Goyal raises questions about the imposition of penalties under Section 271(1)(c) of the Income-tax Act, 1961. The court dismissed the Departmental appeal, highlighting a crucial failure in clarifying the grounds for penalty imposition.
Detailed Analysis: The appeal pertains to the Assessment Year (AY) 2004-05, focusing on the order dated 30.03.2022 and the corrigendum dated 08.04.2022 issued by the Income Tax Appellate Tribunal (Tribunal). The key issue was whether the penalty under Section 271(1)(c) had been appropriately imposed.
A significant flaw emerged in the Assessing Officer’s (AO) actions, as there was a lack of clarity in indicating the specific ground for levying the penalty—whether due to concealment of income or furnishing inaccurate particulars. This ambiguity worked against the appellant/revenue, as established by precedents cited in the impugned order.
The Tribunal, in its order dated 30.03.2022, disposed of the cross-appeals filed by the parties. Subsequently, another related appeal (ITA No. 345/2023) concerning the same AY was adjudicated by the court, resulting in a detailed order that found no substantial question of law for consideration.
Drawing parallels from the earlier appeal, the current case faces a similar fate. The court, in its judgment, closed the appeal, asserting that no substantial question of law arises for consideration. This conclusion stems from the consistent stance taken in previous judgments and the absence of grounds warranting a different outcome.
Conclusion: In light of the aforementioned circumstances, the Delhi High Court’s decision in the PCIT vs Gopal Kumar Goyal case signifies the significance of clarity in penalty imposition. The dismissal of the Departmental appeal reinforces the principle that a failure to specify the grounds for penalty can prove detrimental to the revenue’s case. Parties involved are advised to adhere to the digitally signed copy of the order for further actions. The judgment serves as a noteworthy precedent, emphasizing the need for precision in tax-related proceedings to avoid unnecessary legal complexities.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
1. This is an application filed by the appellant/revenue seeking condonation of delay in re-filing the appeal.
1.1 According to the appellant/revenue, there is a delay of two hundred and twenty (220) days in re-filing the appeal.
2. Ms Monika Aggarwal, who appears on behalf of the respondent/assessee, says that she would have no objection if the delay in re-filing is condoned.
2.1 It is ordered accordingly.
3. The application is, accordingly, disposed of.
ITA 335/2023
4. This appeal concerns Assessment Year (AY) 2004-05.
5. Via the instant appeal, the appellant/revenue seeks to assail the order dated 30.03.2022 and corrigendum dated 08.04.2022 issued by the Income Tax Appellate Tribunal [in short, “Tribunal”].
6. The issue that arose for consideration before the Tribunal was whether the penalty under Section 271(1)(c) of the Income-tax Act, 1961 [in short, “Act”] had been correctly imposed.
7. The record shows, and something that is not in dispute, is that the Assessing officer (AO) had not indicated, with clarity, the ground on which penalty had been levied i.e., on account of concealment of income or furnishing inaccurate particulars.
7.1 Thus, according to the Tribunal, this issue already stood covered against the appellant/revenue in several judgments that have been referred to in paragraph 14 of the impugned order dated 30.03.2022.
8. The Tribunal, via impugned order dated 30.03.2022, disposed of the cross-appeals filed by the parties herein.
8.1 It is in this context that ITA No. 345/2023, titled Pr. Commissioner of Income Tax (Central)-2 v. Gopal Kumar Goyal, concerning the very same AY, i.e., AY 2004-05 came up for adjudication before this court. The said appeal preferred by the appellant/revenue was closed with a detailed order concluding that no substantial question of law arose for consideration.
9. Given the aforesaid circumstances, the same fate will follow insofar as this appeal is concerned.
10. Accordingly, the appeal is closed as no substantial question of law arises for our consideration.
11. Parties will act based on the digitally signed copy of the order.
