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2009 (4) TMI 1064 - ITAT DELHIPenalty imposed u/s 271(1) if returned income is a loss - CIT(A) deleted penalty levied holding that the issue is covered with the decision of the Hon'ble Supreme Court in the case of Virtual Soft Systems Ltd. [2007 (2) TMI 147 - Supreme Court and as the returned income and assessed income in these cases are a loss figure, the penalty u/s. 271(1)(c) cannot be imposed - HELD THAT:- We find that the decision of the Hon'ble Supreme Court in the case of Virtual Soft Systems Ltd. (supra) stands over ruled with the decision of the Apex Court in the case of CIT v. Gold Coin Health Food Pvt. Ltd. [2008 (8) TMI 5 - Supreme Court. However, since the penalties imposed u/s. 271(1)(c) in these cases were not decided on the merits thereof and the CIT(A) has recorded that there is no need to adjudicate the issue on merits of the case in view of the decision in the case of Virtual Soft Systems Ltd. (supra), we hold that it shall be in the interest of justice to set aside the issue in all these appeals to the file of CIT(A) with direction to adjudicate the appeals of the assessee de novo, on merits, after affording reasonable opportunity of being heard to the parties.
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