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TMI Blog2018 (3) TMI 1202X X X X Extracts X X X X X X X X Extracts X X X X ..... 53A was issued on 22.02.2013 asking for the returns for the AYs 2006-07 to 2011-12. On perusal of the accounts, the AO observed that the assessee has shown loan from Sri Ranjan Kumar Paul to the tune of Rs. 1,00,000/- in each of the year. Accordingly, the AO asked the assessee to furnish the loan confirmation certificates. In response, the assessee replied that "There is no such balance due to Ranjan Kumar Paul. This balance of Rs. 1,00,000/- relates to income earned by me from undisclosed sources which has not been offered for taxation and the same may please be considered in my hand for the AY 2006-07". In view of the above reply, the AO treated the said income as undisclosed income and hence, he treated the same as concealed income of the assessee and initiated penalty proceedings u/s. 271(1)(c) of the Act and imposed a penalty of Rs. 22,186/- being 100% of tax sought to be evaded. On appeal, the Ld. CIT(A) confirmed the action of the AO. Aggrieved, assessee is in appeal before us. 3. At the outset, ld. Counsel for the assessee submitted before us that the show cause notice issued u/s 274 of the Act r.w.s. 271 of the Act dated 28.03.2014 before imposing penalty does not contain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sition has been followed by the Tribunal. 5. Ld. DR vehemently opposed the submission of the Ld. AR and has cited various case laws to oppose the case laws suggested by the Ld. AR. We note that all the case laws cited before us by the Ld. DR has been dealt with elaborately by the Coordinate Bench of this Tribunal in the case of Jeetmal Choraria Vs. ACIT, ITA No. 956/Kol/2016 for AY 2010-11 dated 01.12.2017, wherein the Tribunal has noted as under: "7. The learned DR submitted that the Hon'ble Calcutta High Court in the case of Dr.Syamal Baran Mondal Vs. CIT (2011) 244 CTR 631 (Cal) has taken a view that Sec.271 does not mandate that the recording of satisfaction about concealment of income must be in specific terms and words and that satisfaction of AO must reflect from the order either with expressed words recorded by the AO or by his overt act and action. In our view this decision is on the question of recording satisfaction and not in the context of specific charge in the mandatory show cause notice u/s.274 of the Act. Therefore reference to this decision, in our view is not of any help to the plea of the Revenue before us. 8. The learned DR relied on three decisions of Mu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sufficient if the assessee was aware of the charges he had to meet and was given an opportunity of being heard. A mistake in the notice would not invalidate penalty proceedings. 10. In the case of Earthmoving Equipment Service Corporation (supra), the ITAT Mumbai did not follow the decision rendered in the case of Manjunatha Cotton & Ginning Factory (supra) for the reason that penalty in that case was deleted for so many reasons and not solely on the basis of defect in show cause notice u/s.274 of the Act. This is not factually correct. One of the parties before the group of Assessees before the Karnataka High Court in the case of Manjunatha Cotton & Ginning (supra) was an Assessee by name M/s.Veerabhadrappa Sangappa & Co., in ITA NO.5020 OF 2009 which was an appeal by the revenue. The Tribunal held that on perusal of the notice issued under Section 271(1)(c) of the Act, it is clear that it is a standard proforma used by the Assessing Authority. Before issuing the notice the inappropriate words and paragraphs were neither struck off nor deleted. The Assessing Authority was not sure as to whether she had proceeded on the basis that the assessee had either concealed its income or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Hon'ble Bombay High Court in the case of Smt.Kaushalya (supra). 13. In the case of Mahesh M.Gandhi (supra) the Mumbai ITAT the ITAT held that the decision of the Hon'ble Karnataka High Court in the case Manjunatha Cotton & Ginning (supra) will not be applicable to the facts of that case because the AO in the assessment order while initiating penalty proceedings has held that the Assessee had concealed particulars of income and merely because in the show cause notice u/s.274 of the Act, there is no mention whether the proceedings are for furnishing inaccurate particulars or concealing particulars of income, that will not vitiate the penalty proceedings. In the present case there is no whispher in the order of assessment on this aspect. We have pointed out this aspect in the earlier part of this order. Hence, this decision will not be of any assistance to the plea of the revenue before us. Even otherwise this decision does not follow the ratio laid down by the Hon'ble Karnataka High Court in the case of Manjunatha Cotton & Ginning (supra) in as much as the ratio laid down in the said case was only with reference to show cause notice u/s.274 of the Act. The Hon'ble Court di ..... X X X X Extracts X X X X X X X X Extracts X X X X
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