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2017 (7) TMI 207 - ITAT DELHILevying penalty u/s 271(1)(c) - whether Assessing Officer has issued a vague notice for the initiation of the penalty proceedings? - Held that:- We have seen the copy of the notice which shows that irrelevant clauses of the notice were not struck by the Assessing Officer at the time of initiation of proceedings. These types of notices are severely criticized by various courts including case of Manju Nath Cotton Mills [2013 (7) TMI 620 - KARNATAKA HIGH COURT] which held that penalty proceedings are liable to be quashed if the same are initiated on these type of notices. Issuance of these type of notices would show complete non application of mind of the Assessing Officer which is not permissible. DR made arguments that it is a case of difference of opinion because the Assessing Officer has made the addition, in quantum proceedings u/s 68. While ITAT in quantum proceedings has upheld the addition u/s 69A which provisions are materially different from the provisions of section 68 and hence it is a case of difference opinion. But on this point also penalty is not leviable. The assessee has turnover of ₹ 4.79 crore and has paid salary to the tune of ₹ 2043 lacs in the impugned year and whatever the assessee has also produced a certificate from the national bank certifying that alleged share application money received by the assessee was actually returned to the subscriber. The ld. DR could not controvert these arguments and hence we are fully convinced with the ld. AR that whatever entries were passed in the books were passed in the bona fide manner. No penalty is leviable for violation of deeming provisions. - Decided in favour of assessee.
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