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These are the latest case laws decided by various Income Tax Appellate Tribunals (ITAT) of India on Income Tax which have been published recently. The case laws are open for discussion and we invite expert comments from our members on its applicability and effect on relevant issues.

12-04-2019, GE Packaged Power, Section 271(1)(c), 275(1)(a), Tribunal Delhi

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1 week 1 day ago #9134 by amit
Section - 271(1)(c), 275(1)(a), 274
Order Date - 12-04-2019
Favouring - Allowed for statistical purpose
Court - Tribunal Delhi
Appellant - GE Packaged Power Inc.
Respondent - DCIT
Justice - BEENA A. PILLAI JM & ANADEE NATH MISSHRA AM
Citation - 419Taxpundit169
Appeal No. - ITA No.: 765/Del/2019
Asstt. Year - 2001-02

Order

PER : ANADEE NATH MISSHRA, AM

These are the appeals filed by the assessee against the orders each dated 22.11.2018 of Ld. Commissioner of Income Tax (Appeals)- 42, New Delhi [‘CIT (A)’ for short] in Appeal Nos. 765/Del/2019 (Assessment Year: 2001-02), 693/Del/2019 (Assessment Year: 2001-02), 757/Del/2019 (Assessment Year: 2008-09), 756/Del/2019 (Assessment Year: 2007-08), 755/Del/2019 (Assessment Year: 2006-07), 754/Del/2019 (Assessment Year: 2005-06), 692/Del/2019 (Assessment Year: 2004-05), 758/Del/2019 (Assessment Year: 2004-05).

1.1) Grounds of appeal in ITA No. 765/Del/2019 are as under:

1. That on the facts and circumstances of the case and in law, the Commissioner of In ome-tax (Appeals) [“CIT(A)”] erred in confirming the action of the Assessing Officer (“AO”) in levying penalty of Rs. 76,34,170/- under Section 271(1)(c) of the Income Tax Act, 1961 (“the Act”)

2. That on the facts and circumstances of the case and in law, the Ld. CIT(A) erred in not adjudicating Ground 2.1 in the Form No. 35 filed by the Appellant before the Ld. CIT(A) wherein the Appellant challenged the action of the Ld. AO in levying Penalty of INR 76,34,170/- @100% of the alleged tax on assessed income, without appreciating that penalty is to be levied only on the amount of income on which tax is sought to be evaded i.e. income from offshore supply and offshore repair work in the present case (income of INR 5,98,005*48% tax rate), is INR 2,87,042 and not on the returned income already offered to tax in return of income filed by the Appellant.

3. That on the facts and circumstances of the case and in law, the Ld. AO erred in passing the penalty order under Section 271(1)(c) of the Act which are wholly without jurisdiction and clearly barred by limitation inasmuch as the same have been passed beyond the period of limitation prescribed under Section 275(1)(a) of the Act.

4. That on the facts and circumstances of the case and in law, the CIT(A) erred in upholding the initiation of penalty by way of issue of penalty notice under Section 274 of the Act without specifying whether the penalty is initiated for concealment of income or for furnishing of inaccurate particulars of income.

5. That on the facts and circumstances of the case and in law, the CIT(A) erred in alleging that the Appellant had concealed particulars of income, without appreciating that the Appellant made complete disclosure in the notes accompanying the return of income.

6. That on the facts and circumstances of the case and in law, the CIT(A) erred in upholding the levy of penalty, without appreciating that on identical facts, penalty had been deleted by the predecesso of the CIT(A) in the case of GE Caledonian Ltd. and GE Aviation Service Operation LLP for the AY 2011-12.

7. That on the facts and circumstances of the case and in law, the CIT(A) erred in upholding the levy of penalty, without appreciating that the Hon’ble High Court having admitted the appeal of the Appellant for the same AY on a substantial question of law qua existence of a permanent establishment, the issue was prima facie debatable, on which no penalty could have been levied,

8. That on the facts and circumstances of the case and in law, the CIT(A) erred in upholding the levy of penalty, without appreciating that penalty under Section 271(1)(c) of the Act had been deleted in the case of Rolls Royce, which formed the bedrock and sole basis of the addition made by the AO, on which penalty has now been levied.

9. That on the facts and circumstances of the case and in law, the CIT(A) erred in confirming the levy of penalty under Section 271(1)(c) of the Act on the basis of profits attributed to the alleged PE of the Appellant, which was based on estimation, and, therefore, do not tantamount to concealment of income or furnishing of inaccurate particulars of income.

Grounds of appeal in ITA No. 693/Del/2019 are as under:

1. That on the facts and circumstances of the case and in law, the Commissioner of Income-tax (Appeals) [“CIT(A)”] erred in confirming the action of the Assessing Officer (“AO”) in levying penalty of Rs. 34,29,630/- under Section 271(1)(c) of the Income Tax Act, 1961 (“the Act”)

2. That on the facts and circumstances of the case and in law, the Ld. AO erred in passing the penalty order under Section 271(1)(c) of the Act which are wholly without jurisdiction and clearly barred by limitation inasmuch as the same have been passed beyond the period of limitation prescribed under Section 275(1)(a) of the Act.

3. That on the facts and circumstances of the case and in law, the CIT(A) erred in upholding the initiation of penalty by way of issue of penalty notice under Section 274 of the Act without specifying whether the penalty is initiated for concealment of income or for furnishing of inaccurate particulars of income.

4. That on the facts and circumstances of the case and in law, the CIT(A) erred in alleging that the Appellant had concealed particulars of income, without appreciating that the Appellant made complete disclosure in the notes accompanying the return of income.

5. That on the facts and circumstances of the case and in law, the CIT(A) erred in upholding the levy of penalty, without appreciating that on identical facts, penalty had been deleted by the predecessor of the CIT(A) in the case of GE Caledonian Ltd. and GE Aviation Service Operation LLP for the AY 2011-12.

6. That on the facts and circumstances of the case and in law, the CIT(A) erred in upholding the levy of penalty, without appreciating that the Hon’ble High Court having admitted the appeal of the Appellant for the same AY on a substantial question of law qua existence of a permanent establishment, the issue was prima facie debatable, on which no penalty could have been levied,

7. That on the facts and circumstances of the case and in law, the CIT(A) erred in upholding the levy of penalty, without appreciating that penalty under Section 271(1)(c) of the Act had been deleted in the case of Rolls Royce, which formed the bedrock and sole basis of the addition made by the AO, on which penalty has now been levied.

8. That on the facts and circumstances of the case and in law, the CIT(A) erred in confirming the levy of penalty under Section 271(1)(c) of the Act on the basis of profits attributed to the alleged PE of the Appellant, which was based on estimation, and, therefore, do not tantamount to concealment of income or furnishing of inaccurate particulars of income.

Grounds of appeal in ITA No. 757/Del/2019 are as under:

1. That on the facts and circumstances of the case and in law, the

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