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TMI Blog2018 (7) TMI 1164X X X X Extracts X X X X X X X X Extracts X X X X ..... y, illegal, unjust against the facts as well as against the law. 2. That the appellant prays to allow to admit the additional grounds of appeal at the time of hearing." 4. Facts of the case for the assessment year 2006-07 in brief are that the assessee filed the return of income on 24.11.2006 declaring total income of Rs. 3,66,88,330/-. However, the assessment was completed u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred to as the Act) at an income of Rs. 3,67,66,430/- on 11.08.2008. Thereafter, a search and seizure operation took place and the assessee in response to the notice u/s 153A of the Act filed the return of income initially at Rs. 3,67,66,430/- on 11.08.2009. Subsequently, a revised return was filed on 08.10.2009 declaring an income of Rs. 3,78,16,430/- and finally declaring a taxable income of Rs. 3,79,58,650/-. The assessment was framed at an income of Rs. 3,79,58,650/- vide order dated 30.12.2010. During the course of assessment proceedings u/s 153A of the Act, the AO found that the assessee had paid cash in the form of commission amounting to Rs. 11,92,220/- to the purchasers and while recording the statement u/s 132(4) of the Act, at the time of sea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he year under reference. iii) If the disclosure was made of Rs. 70 Lacs on account of unaccounted business expenditure then why he has not declared the same in the returns of the relevant assessment years. iv) In the reply the assessee submitted that the amount of Rs. 11,92,220/-was ascertained only after inspection of the seized record. Here is also necessary to mention that if no such data were available with the assessee then on what basis he made surrender of Rs. 70 Lacs during search operation. v) In the reply the assessee has wrongly mentioned that he was given the copy of annexure on 08.12.2010 whereas the copy of the said annexure 'A-3' was given to the assessee on 01.12.2010. If the copy of seized record was made available on 08.12.2010 then on what basis how the assessee has filed a letter dated 08.12.2010 making therein the quantification of income was filed. vi) In its reply letter assessee submitted that the assessee company was not aware of the exact amount and the period thereof. From these facts it is evident that assessee knowingly did not disclose the accurate particulars of the taxable income in respect of the income which was duly disclosed b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Assessing Officer in the search conducted does not relieve the assessee from the mischief of the penalty proceedings. In view of the discussion above, and the judicial pronouncements relied upon which is applicable to the case of the appellant, penalty levied by the AO is confirmed." 7. Now the assessee is in appeal. The ld. Counsel for the assessee submitted that the AO initiated the penalty proceedings in respect of furnishing of inaccurate particulars of income. A reference was made to page no. 3 of the assessment order. It was further submitted that the penalty was levied for concealment of income, therefore, the penalty was initiated on different footings then levied u/s 271(1)(c) of the Act. It was further submitted that in the notice issued u/s 274 of the Act, the AO has not mentioned the specific charge under which the penalty proceedings were initiated. A reference was made to page no. 2 of the assessee's paper book which is the copy of notice issued u/s 274 r.w.s. 271 of the Act. The reliance was placed on the following case laws: * CIT-II Vs Sh. Samson Perichery in ITA No. 1154 of 2014 order dated 05.01.2017 (Bom. HC) * Filatex India Ltd. Vs DCIT, Circle-11(1), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 71(1)(c) of the Act on account of concealment of taxable income. 12. It is also noticed that the AO in the notice u/s 274 of the Act has not mentioned the specific charge on which the penalty proceedings were initiated u/s 271(1)(c) of the Act. In the aforesaid notice, copy of which is placed at page no. 2 of the assessee's paper book, it is mentioned as under: "Whereas in the course of proceedings before me for the assessment year 2006-07 it appears that you. ---------------------------------- ---------------------------------- "have concealed the particulars of your income or.............furnished inaccurate particulars of such income." 13. From the above notice dated 30.12.2010, it is crystal clear that no specific charge is mentioned while issuing the notice u/s 274 of the Act for levying the penalty u/s 271(1)(c) of the Act. 14. On a similar issue, the Hon'ble Bombay High Court in the case of CIT-II Vs Sh. Samson Perinchery in ITA No. 1154/2014 vide order dated 05.01.2017 (supra) by following the judgment of the Hon'ble Karnataka High Court in the case of CIT Vs Manjunatha Cotton & Ginning Factory reported at 359 ITR 565 deleted the penalty. The relevant observat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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." 5. The grievance of the Revenue before us is that there is no difference between furnishing of inaccurate particulars of income and concealment of income. Thus, distinction drawn by the impugned order is between Tweedledum and Tweedledee. In the above view, the deletion of the penalty, is unjustified. 6. The above submission on the part of the Revenue is in the face of the decision of the Supreme Court in Ashok Pai v/s. CIT 292 ITR 11 [relied upon in Manjunatha Cotton & Ginning Factory (supra)] - wherein it is observed that concealment of income and furnishing of inaccurate particulars of income in Section 271(1)(c) of the Act, carry different meanings/ connotations. Therefore, the satisfaction of the Assessing Officer with regard to only one of the two breaches mentioned under Section 271(1)(c) of the Act, for initiation of penalty pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f your income or furnished inaccurate particulars of such income in terms of explanation 1, 2, 3, 4 and 5. ............................." 9. It, therefore, is amply clear that the Assessing Officer has not specified whether the notice was issued for concealment of particulars of income or for furnishing of inaccurate particulars of income. We have carefully perused the material papers on record in the light of the statements made on behalf of the assessee including the judgment relied upon by him in the case of CIT vs Manjunatha Cotton & Ginning Factory, 359 ITR 565 (Kar). Vide paragraph 60, the Hon'ble Karnataka High Court has held as follows :- "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 in such cases the initiation of the penalty proceedings also must be for both the offences. But drawing up penalty proceedings for one offence and finding the assessee guilty of another offence or finding him guilty for either the one or the other cannot be s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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