9911796707
TMI Blog2015 (9) TMI 1011X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee in his original return of income filed u/s. 139 had declared income of Rs. 2,17,810/- in assessment year 2007-08. Thus, the additional income of Rs. 7,92,190/- was declared in assessment year 2007-08. In assessment year 2008-09, the assessee had declared income of Rs. 1,94,580/- in his original return of income filed u/s. 139. The additional income declared in return of income filed u/s. 153A was Rs. 1,36,520/-. The return filed by the assessee u/s. 153A in both the impugned assessment years were accepted by the Assessing Officer without making any further addition. Penalty proceedings u/s. 271(1)(c) were initiated against the assessee. For the assessment year 2007-08 penalty of Rs. 2,46,270/- and in assessment year 2008-09 penalty of Rs. 35,470/- was levied u/s. 271(1)(c) vide separate orders, both dated 28-06-2012. Aggrieved by the penalty orders, the assessee filed appeal for both the assessment years before the Commissioner of Income Tax (Appeals). The Commissioner of Income Tax (Appeals) invoked the provisions of Explanation 5A to section 271(1)(c) of the Act and upheld the findings of Assessing Officer in levy of penalty u/s. 271(1)(c) of the Act. Against the finding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessing Officer proposes to invoke the first limb being concealment, then the notice has to be appropriately marked. Similar is the case for furnishing inaccurate particulars of income. The standard yroforma without striking of the relevant clauses will lead to an inference as to non application of mind." 3) Further, a prima facie satisfaction of AO that case may deserve imposition of penalty should be discernible from order passed during course of assessment proceedings. (Madhushree Gupta v. Union of India [20091 183 TAXMAN 100 (DELHI), CIT vs. MWP Ltd. [2014] 41 taxmann.com 496]. Accordingly, The learned AO grossly erred in law in initiating penalty proceedings u/s 271(l)(c), in the assessment order for merely on the ground that "the additional income of Rs. 792190/- is detected and disclosed by the assessee as a result of search action" without recording any objective satisfaction or finding in the assessment order to the effect that there is Concealment or furnishing of inaccurate particulars of income. Therefore it is prayed to cancel the penalty levied u/s 271(l)(c). Without prejudice to above, 3.1) Penalty was initiated in para 6 of the assessment order without ment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .com 188. Held: Whether Assessing Officer has to clearly show-cause assessee as to which of two defaults, [i.e., assessee has concealed particulars of his income or furnished inaccurate particulars of such income] have been committed by assessee and only when assessee is put to that defence penalty under Section 271(l)(c) can be imposed Held, yes - DCIT vs. B.J. D. Paper products [2012] 17 taxmann.com 11 (Luck.) Held: In case of imposition of penalty under Section 271(l)(c), it is incumbent upon the Assessing Officer to come to a positive finding as to whether there was concealment of income by assessee or whether any inaccurate particulars of such income had been furnished by assessee. Identical views: Padma Ram Bharali vs. CIT, 110ITR 54 (Gau.) Rustom Sorab Medora vs. ITO [ITA No. 2283/Ahd/2012] (Ahd.) etc. 4) Even CIT(A)-I, Nashik erred in law in confirming the penalty u/s 271(l)(c) for furnishing inaccurate particulars of income and concealment of income, both. 5) All the above grounds were also before CIT(A)-I [Gr. No. (2), (3) & (5) of Grounds of appeal]. However, the learned CIT(A) safely neglected and failed to rebut the same in his order, for the reasons best k ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has pointed out that if the irrelevant columns of the printed form of notice u/s. 274 have not been stuck off by the Assessing Officer, the notice for levy of penalty u/s. 271(1)(c) shall be deemed to be invalid. In support of these submissions, reliance has been placed on the decision of Hon'ble Karnataka High Court in the case of CIT Vs. Manjunatha Cotton & Ginning Factory reported as 359 ITR 565 (Karan). 6. A perusal of the order passed u/s. 271(1)(c) dated 28-06-2012 levying penalty shows, that in para 2 the Assessing Officer has specifically mentioned that penal proceedings u/s. 271(1)(c) are initiated for concealing the income. The relevant extract of para 2 of the order levying penalty reads as under: "2. ..........Since assessee had originally concealed income to the extent of Rs. 7,92,190/-, penalty proceedings u/s. 271(1)(c) of the Act was initiated on finalization of assessment proceedings." In both the impugned assessment years, the order levying penalty are similarly worded. 7. In the concluding paragraph of the order, the Assessing Officer has observed that the penalty is levied for furnishing of inaccurate particulars of income and concealing income. The re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty on him as the Section 274 makes it clear that assessee has a right to contest such proceedings and should have full opportunity to meet the case of the Department and show that the conditions stipulated in Section 271(1)(c) do not exist as such he is not liable to pay penalty. The practice of the Department sending a printed form where all the ground mentioned in Section 271 are mentioned would not satisfy requirement of law when the consequences of the assessee not rebutting the initial presumption is serious in nature and he had to pay penalty from 100% to 300% of the tax liability. As the said provisions have to be held to be strictly construed, notice issued under Section 274 should satisfy the grounds which he has to meet specifically. Otherwise, principles of natural justice is offended if the show cause notice is vague. On the basis of such proceedings, no penalty could be imposed on the assessee. 60. Clause (c) deals with two specific offences, that is to say, concealing particulars of income or furnishing inaccurate particulars of income. No doubt, the facts of some cases may attract both the offences and in some cases there may be overlapping of the two offences but ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
