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TMI Blog2017 (12) TMI 257X X X X Extracts X X X X X X X X Extracts X X X X ..... me. Therefore, the entire penalty proceedings stand vitiated, because it is not in accordance with law - Decided in favour of assessee. - I.T.A. No. 6236/DEL/2015 - - - Dated:- 4-12-2017 - SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI L.P. SAHU, ACCOUNTANT MEMBER For The Assessee : Sh. Amarjeeet Singh, CA For The Department : S h. Kaushlendra Tiwari, Sr. DR ORDER PER H.S. SIDHU, JM Assessee has filed the appeal against the Order dated 04.9.2015 passed by the Ld. Commissioner of Income Tax (Appeals-I), New Delhi pertaining to assessment year 2009-10. The solitary issue raised in the appeal is relating to upholding the penalty of ₹ 36,58,000/- u/s. 271(1)(c) of the I.T. Act, 1961. 2. The facts in brief ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Disallowance of Expenses on account of return of investment of ₹ 10,84,005/-. In his appellate order dated 01.2.2013 the Ld. CIT(A) did not allow the appeal of the assessee. The assessee had further filed appeal to ITAT, New Delhi against disallowance u/s. 14A of ₹ 4,07,158/- and against Long Term Capital Loss treated as Business income of ₹ 91,39,000/- and the ITAT vide its order dated 5.8.2016 in ITA No. 2375/Del/2013 had allowed the appeal of the assesse and deleted the quantum additions of ₹ 4,07,158/- and ₹ 91,39,000/-. However, during the penalty proceedings, the AO vide his order dated 31.3.2014 imposed penalty of ₹ 36,58,000/- u/s. 271(1)(c) of the Act, in respect of total additions of ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... validly initiated under such circumstances. He further stated that neither the assessment order nor the printed show cause notice nowhere states the specific charge of alleged concealment and / or furnishing of inaccurate particulars of income vis- -vis addition made. In view of the above, he stated that entire penalty proceedings stand vitiated, because it is not in accordance with law and in order to support his contention, he placed the reliance on the following decisions:- - Hon ble Karnataka High Court decision in the case of CIT Ors. Vs. M/s Manjunatha Cotton and Ginnig Factory Ors. (2013) 359 ITR 565 - Apex Court decision in the case of CIT Anr. Vs. M/s SSA s Emerald Meadows in CC No. 11485/2016 dated 05.8.2016. In vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de and proves that all the material facts have been disclosed. 5. CIT vs. Gates Foam Rubber Co [91 ITR 467] CIT vs India Seafood [105 ITR 708] where Hon'ble Kerala High Court held that Claiming excessive deduction also amounts to concealment of income 6. Steel Ingots Ltd vs. CIT [296 ITR 228] where Hon'ble Madhya Pradesh High Court held that in case of concealment of true income chargeable. to tax by making bogus claim, levy of penalty u/s 271 (1 )(c) read with Explanation 1 is justified 7. CIT Vs Escorts Finance Ltd [183 Taxman 453 (Delhi)/[2010] 328 ITR 44 (Delhi)/[2009] 226 CTR 105] where Hon'ble Delhi High Court held that if claim made in return of income appears to be ex facie bogus, it would be treated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de his order dated 31.3.2014 imposed penalty of ₹ 36,58,000/- u/s. 271(1)(c) of the Act, in respect of all the four additions of ₹ 1,07,62,163/- mentioned in the grounds of appeal, as aforesaid, on the alleged ground that the assessee had furnished inaccurate particulars of income. 6.1 After perusing the assessment order, we find that AO also did not record his satisfaction for initiation of penalty proceedings, because while passing the assessment order dated 30.12.2011 passed u/s. 143(3)(ii) of the Act, the AO has stated that .. Penalty proceedings u/s. 271(1) is being initiated separately for furnishing inaccurate particulars of income / concealment income . , which is not sufficient and therefore, the penalty proc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1) TMI 1620 (Supra) Karnataka High Court. Notice issued by AO under section 274 read with section 271(1)(c) to be bad in law as it did not specify which limb of Section 271(1) of the Act, the penalty proceedings had been initiated i.e., whether for concealment of particulars of income or furnishing of inaccurate particulars of income Decided in favour of assessee. 6.2 In the background of the aforesaid discussions and respectfully following the precedents, we delete the penalty in dispute and decide the issue in favor of the assessee and against the Revenue. Since we have deleted the penalty and did not discuss the penalty issue on merit, hence, the case laws cited by the Ld. DR are not useful at this juncture, because these case ..... X X X X Extracts X X X X X X X X Extracts X X X X
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