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TMI Blog2016 (8) TMI 961X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome. The standard proforma without striking of the relevant clauses will lead to an inference as to non-application of mind. - Decided in favour of assessee - ITA NO. 616/2015 - - - Dated:- 28-7-2016 - MR. JAYANT PATEL AND MR. S.N. SATYANARAYANA JJ. Appellants (by Sri E. I. Sanmathi, A/W Sri. K.V. Aravind, Advocate s (Standing Counsel)) JUDGMENT JAYANT PATEL J., The appellants-Revenue have preferred the present appeal by raising the following substantial question of law: Whether under the facts and in the circumstances of the case, the Tribunal was right in law in canceling the penalty levied under section 271(1)(c) overlooking the provisions of the Act and even when all the ingredients are satisfied for levy of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated, in the notice to be issued under Section 274, they could conveniently refer to the said order which contains the satisfaction of the authority which has passed the order. However, if the existence of the conditions could not be discerned from the said order and if it is a case of relying on deeming provision contained in Explanation-1 or in Explanation-1(B), then though penalty proceedings are in the nature of civil liability, in fact, it is penal in nature. In either event, the person who is accused of the conditions mentioned in Section 271 should be made known about the grounds on which they intend imposing penalty on him as the Section 274 makes it clear that assessee has a right to contest such proceedings and should have full op ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion or proceedings, the penalty proceedings should be confined only to those grounds and the said grounds have to be specifically stated so that the assessee would have the opportunity to meet those grounds. After, he places his version and tries to substantiate his claim, if at all, penalty is to be imposed, it should be imposed only on the grounds on which he is called upon to answer. It is not open to the authority at the time of imposing penalty to impose penalty on the grounds other than what assessee was called upon to meet. Otherwise though the initiation of penalty proceedings may be valid and legal, the final order imposing penalty would offend principles of natural justice and cannot be sustained. Thus once the proceed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has to be clear as to the limb for which it is levied and the position being unclear penalty is not sustainable. Therefore, when the Assessing 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 proforma without striking of the relevant clauses will lead to an inference as to non-application of mind. Since the facts and circumstances in the case before us are similar, respectfully following the jurisdictional High Court in the above case (cited supra), we delete the penalty levied by the AO u/s 271(1)(c) of the Act. 5. As such, when the issue is already covered by the decision of this Court, it ..... X X X X Extracts X X X X X X X X Extracts X X X X
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