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TMI Blog2019 (2) TMI 1536X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. First we take up ITA No.5501/Del/2018. Facts of the case, in brief, are that the assessee filed return of income on 7th February, 2016 declaring total taxable income of Rs. 5,97,690/-. Subsequently, the case of the assessee was selected for scrutiny and statutory notices were issued. The assessee appeared from time to time and, thereafter, the Assessing Officer completed the assessment u/s 143(3) on 29.11.2017 determining the total income at Rs. 23,16,540/- wherein he made addition of Rs. 11,87,719/- on account of derivative trading, Rs. 3,12,000/- out of salary to staff, Rs. 1,16,850/- under the head 'Travelling expenses', Rs. 44,630/- out of training expenses and Rs. 57,650/- out of depreciation. Subsequently, the Assessing Officer ini ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xplanation for not showing the above income in the return. The case of the appellant is covered by Explanation 1(B) to section 271(1 )(c) of the Act. It is noted that the appellant has concealed the particulars of income of this account. There is no reasonable cause in the case of the appellant as provided u/s 273B of the Act. Under the facts it is held that the AO was justified to levy penalty u/s 271(1)(c) of the Act. The same is hereby confirmed. Grounds of appeal Nos.l & 6 are dismissed." 4. Aggrieved with such order of the CIT(A), the assessee is in appeal before the Tribunal raising the following grounds:- 1. That on the facts and circumstances of the case and in law, the order passed by CIT (A), Muzafernagar (hereinafter referred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f income or furnishing of inaccurate particulars of such income the penalty has been levied. Referring to various decisions of the Tribunal and the decision of the Hon'ble Karnataka High Court in the case of Manjunath Cotton Mills reported in 359 ITR 565 (Kar), he submitted that if the Assessing Officer does not strike off the inappropriate words from the notice, then, levy of penalty u/s 271(1)(c) is not justified since it is not known under which limb of the provision the penalty has been levied. Further, the Assessing Officer in the assessment order has not reached requisite satisfaction as to whether the initiation of penalty is on account of concealment of income or furnishing of inaccurate particulars of income. Referring to the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tly laid down in Ram Commercial Enterprises (supra) and we are in respectful agreement with the same. The reference is answered accordingly." 6. He accordingly submitted that the penalty levied by the Assessing Officer is not justified. He also relied on the decision of the Hon'ble Delhi High Court reported in Ms Madhushree Gupta vs. Union of India (2009) 317 ITR 107 (Del). 7. The ld. DR, on the other hand, heavily relied on the order of the CIT(A). He submitted that the assessee has not taken such grounds before the lower authorities, therefore, he should not be permitted to argue on this aspect. Since the assessee has concealed particulars of income and has furnished inaccurate particulars by not disclosing his true income, the CIT( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ities along with the relevant records available with us. Firstly, we have perused the assessment order dated 11.10.2010 passed u/s. 143(3) of the Act and found that AO while completing the assessment has not recorded the satisfaction and has not initiated the penalty proceedings. Similarly, at the time of imposing the penalty u/s. 271(1)(c) of the Act, the AO has levied the penalty, but did not mention under which limb the penalty has been imposed whether it is on account of inaccurate particulars of income or concealment of income. Therefore, the entire penalty proceedings stand vitiated. In view of above, the penalty is not sustainable in the eyes of law. Our aforesaid view is fortified by the following decisions:- i) "CIT & Anr. Vs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f 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." 10. Since the facts of the impugned appeal are identical to the facts of the case decided by the Tribunal in the case of Yum ! Restaurants Marketing Pvt. Ltd. (supra), therefore, respectfully following the same, I cancel the penalty so levied by the Assessing Officer and upheld by the CIT(A) due to non-striking off the inappropriate words in the notice. The grounds raised by the assessee are allowed. ITA No.5500/Del/2018 11. The grounds raised by the assessee read as under:- 1. That on the facts and circumstances of the case and in law, the order passed by CIT (A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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