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TMI Blog2019 (4) TMI 1523X X X X Extracts X X X X X X X X Extracts X X X X ..... NG FACTORY (2013 (7) TMI 620 - KARNATAKA HIGH COURT) . Also see M/S SSA'S EMERALD MEADOWS [ 2016 (8) TMI 1145 - SUPREME COURT] - Decided in favour of assessee. - ITA No.1422/Bang/2017 - - - Dated:- 24-4-2019 - Shri Jason P Boaz, Accountant Member And Shri Laliet Kumar, Judicial Member For the Assessee : Shri. Sandeep C, CA For the Revenue : Shri. L. V. Bhaskar Reddy, Addl. CIT ORDER PER SHRI JASON P BOAZ, A.M. : This appeal by the assessee is directed against the order of CIT(A), Davangere, dated 30.03.2017, upholding the levy of penalty of ₹ 1,08,550/- under section 271(1)(c) of the Income Tax Act, 1961 (in short the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he order of the learned Commissioner of Income Tax (Appeals), in so far it is prejudicial to the interests of the appellant, is bad and erroneous in law and against the facts and circumstances of the case. 2. That the notice issued u/s 274 r.w.s 271(1)(c) of the Act is bad in law as it is vague and does not state whether the appellant has concealed the income or furnished inaccurate particulars. 3. That the Assessment Order does not record any satisfaction that the appellant has concealed income or furnished inaccurate particulars and therefore, levy of penalty u/s. 271(1)(c) is bad in law. 4. That the learned Commissioner of Income Tax (Appeals) erred in law and on facts in levying p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (c) of the Act dated 31.12.2013 for Assessment Year 2011-12 filed by the assessee, at page 12 of Paper Book, to demonstrate that the said notice was defective, in as much as it did not indicate whether it was issued to the assessee for concealment of income or for furnishing of inaccurate particulars of income. In support of the proposition that notice issued u/s 274 r.w.s. 271 of the Act, without specifying the default; i.e., whether the notice is issued for concealment of income or furnishing of inaccurate particulars of income; is invalid and consequential penalty proceedings / orders are also not valid; the learned AR placed reliance on the decision of the Hon ble Karnataka High Court in the case of M/s. Manjunatha Cott ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the notice is issued for concealment of particulars of income or furnishing of inaccurate particulars of income; is invalid and the consequential penalty proceedings/orders are also not valid. The relevant portion of the aforesaid judgment of the Hon'ble Karnataka High Court (Supra) at paras 59 to 61 are extracted hereunder:- 59. As the provision stands, the penalty proceedings can be initiated on various ground set out therein, if the order passed by the Authority categorically records a finding regarding the existence of any said grounds mentioned therein and then penalty proceedings is initiated, in the notice to be issued under Section 274, they could conveniently refer to the said order which contains the satisf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 sustained in law. It is needless to point out satisfaction of the existence of the grounds mentioned in Section 271(1)(c) when it is a sine qua non for initiation or proceedings, the penalty proceedings should be confined only to those grounds and the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tal income under clause (c). Concealment, furnishing inaccurate particulars of income are different. Thus the Assessing Officer while issuing notice has to come to the conclusion that whether is it a case of concealment of income or is it a case of furnishing of inaccurate particulars. The Apex Court in the case of Ashok Pal reported in 292 ITR 11 at page 19 has held that. concealment of income and furnishing inaccurate particulars of income carry different connotations. The Gujarat High Court in the case of M4NU ENGINEERING reported in 122 ITR 306 and the Delhi High Court in the case of VIRGO IvL4RKETING reported in 171 Taxman 156, has held that penalty has to be clear as to the limb for which it is levied and the action ..... X X X X Extracts X X X X X X X X Extracts X X X X
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