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2017 (5) TMI 840 - ITAT MUMBAILevy of penalty u/s 271(1)(C) - non mentioning of inaccurate particulars as given by assessee - proof of concealment and furnishing of inaccurate particulars - Held that:- Perusal of the quantum assessment order reveals that the penalty has been initiated without specifying the limb i.e. furnishing of inaccurate particulars of income / concealment of income for which the penalty was being initiated as both the limbs, as per settled legal propositions, are different connotations and carry different meaning. The same also becomes clear from the language of show-cause notice which states that the assessee have concealed the particulars of income or furnished inaccurate particulars of income. Even the show-cause notice did not specify the limb / offence for which the penalty was being initiated. Finally, the penalty has been levied for filing of inaccurate particulars of income leading to concealment of income which shows inconsistent thinking on the part of AO. Undisputedly, the AO was required to specify the exact charge for which the assessee was being penalized which he has failed to do so and the same has resulted into taking away assessee’s valuable right of contesting the same and thereby violates the principles of natural justice. In the case of CIT Vs. Smt. Kaushalya [1995 (1) TMI 25 - BOMBAY High Court ], the Hon’ble jurisdictional High Court observed that the notice issued under Section 274 must reveal application of mind by the Assessing Officer and the assessee must be aware of the exact charge on which he had to file his explanation. It was further observed that vagueness and ambiguity in the notice deprives the assessee of reasonable opportunity to contest the same. - Decided in favour of assessee.
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