rpa 1/4 itxa-747-14.doc IN HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INICOME TAX APPEAL NO.747 OF 2014 Commissioner of Income Tax 8 .. Appellant Vs. Ramesh D. Tainwala .. Respondent ... Mr. Arvind Pinto, Advocate for Appellant. Mr. Jitendra Singh, Advocate for Respondent. ... CORAM : S.C. DHARMADHIKARI AND PRAKASH D. NAIK, JJ. DATED : APRIL 10, 2017. P.C. : This Appeal is brought by Revenue to challenge order passed by Income Tax Appellate Tribunal, Mumbai Bench on 31st July, 2013. 2 Revenue's Appeal was dismissed by Tribunal. Revenue's Appeal was directed against order of first appellate authority, namely, Commissioner of Income Tax, Mumbai dated 13th January, 2012. first Appellate authority deleted penalty of Rs.70 lakhs imposed by Assessing Officer under Section 217(1)(c) of Income Tax Act, 1961 for assessment year 2007-08. ::: Uploaded on - 12/04/2017 ::: Downloaded on - 03/05/2017 09:34:17 ::: rpa 2/4 itxa-747-14.doc 3 reasoning of Tribunal in deleting penalty reads as under : 3. At outset it has been observed that appeal of assessee against ITAT order in quantum proceedings in ITA No.3853/Mum/2010 confirming addition made by revenue authorities has been admitted by Hon'ble High Court of Bombay vide order dated 22.03.2013 in Income Tax Appeal No.96 of 2012 under section 260 of Income Tax Act as issue involves substantial question of law. Where High Court has accepted appeal as subject matter of addition involves substantial of law u/s 260A, it is needless to emphasis that issue is debatable and accordingly, no penalty is imposable u/s. 271(1)(c)of Act. Hon'ble Delhi High Court in CIT v. Liquid Investment & Trading Coo. [in ITA No.240/2009] vide its judgment dated 5.10.2010 has held that issue becomes debatable on admission of substantial question of law against Tribunal order by High Court. In such case also penalty has been held to be not imposable u/s. 271(1)(c)of Act. Mumbai Bench of Tribunal in Nayan Builders & Developers Pvt. ::: Uploaded on - 12/04/2017 ::: Downloaded on - 03/05/2017 09:34:17 ::: rpa 3/4 itxa-747-14.doc Ltd. v. ITO [ITA No.2379/Mum/2009], vie order dated 10.03.2011, has also held that where substantial question of law has been admitted by Hon'ble High Court against additions sustained by Tribunal, there cannot be any question of penalty u/s. 271(1)(c). Similar view has been taken by Third Member of Tribunal in case of Rapam Mercantiles Limited v. DCIT [(2004) 91 ITD 237 (Ahd.) (TM)]. In view of that matter, order of Ld. CIT(A) deleting levy of penalty is upheld. It is this very reasoning which has persuaded this Court in two matters, namely, Commissioner of Income Tax Vs. Nayan Builders and Developers1 and order passed by another Division Bench of this Court in Income Tax Appeal No.1498 of 2014 dated 17th February, 2017 (The Commissioner of Income Tax - 21 Vs. M/s. Advaita Estate Development Pvt. Ltd.) not to interfere with Tribunal's order. 4 It is conceded by both sides that facts and circumstances in this case are identical to those before Division Benches of this Court. As result following these two 1 2014 368 ITR 722 ::: Uploaded on - 12/04/2017 ::: Downloaded on - 03/05/2017 09:34:17 ::: rpa 4/4 itxa-747-14.doc orders of Division Bench, we dismiss Appeal. It does not raise any substantial questions of law. There shall be no order as to costs. (PRAKASH D. NAIK, J.) (S.C. DHARMADHIKARI, J.) ::: Uploaded on - 12/04/2017 ::: Downloaded on - 03/05/2017 09:34:17 ::: Commissioner of Income-tax 8 v. Ramesh D. Tainwala