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TMI Blog2018 (7) TMI 62X X X X Extracts X X X X X X X X Extracts X X X X ..... ,500/- but he did not disclose any income from salary. Hence, the AO added back the same to the total income of the assessee and assessment order was passed u/s. 143(3) of the Act initiating penalty proceedings u/s. 271(1)(c) of the Act for concealment of income by issuing notice u/s. 274 r.w.s. 271(1)(c) of the Act dated 29.06.2016. In response to this, the assessee appeared and submitted explanation which was reproduced by the AO in the order passed u/s. 271(1)(c) of the Act. Dissatisfied with the explanation of the assessee, the AO levied a penalty of Rs. 6,05,524/- being 100% of tax sought to be evaded as penalty u/s. 271(1)(c) of the Act. On appeal, the Ld. CIT(A) confirmed the action of AO. Aggrieved, assessee is before us. 3. At the outset, ld. Counsel for the assessee submitted before us that the show cause notices issued u/s 274 of the Act r.w.s. 271(1)(c) of the Act dated 29.06.2016 before imposing penalty does not contain the specific charge against the assessee namely as to whether the assessee was guilty of having concealed particulars of income or having furnished inaccurate particulars of income. A copy of the show cause notice u/s 274 of the Act was filed before us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ealt 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 Mumbai ITAT viz., (i) Dhanraj Mills Pvt. Ltd. Vs. ACIT ITA No.3830 & 3833/Mum/2009 dated 21.3.2017; (ii) Earthmoving Equipment Service Corporation Vs. DCIT 22(2), Mumbai, (2017) 84 taxmann.com 51 (iii) Mahesh M.Gandhi Vs. ACIT Vs. ACIT ITA No.2976/Mum/201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he 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 has furnished inaccurate details. The notice is not in compliance with the requirement of the particular section and therefore it is a vague notice, which is attributable to a patent non application of mind on the part of the Assessing authority. Furth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll 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 whisper 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 did not lay down a proposition that the defect in the show cause notice will stand cured if the intention of the charge u/s.271(1) (c ) is discernible from a reading of the Assessment order in which the penalty was initiated. 14. From the aforesaid dis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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