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TMI Blog2019 (5) TMI 284X X X X Extracts X X X X X X X X Extracts X X X X ..... essee on the legality of the penalty proceedings initiated u/s 271(1)(c) of the Act. Since the issue of penalty u/s 271(1)(c) has been dealt by us on the preliminary points, other arguments of the assessee dealing with the merits of the levy of penalty are not been dealt with, as the same are rendered academic in nature and thus the appeal of the assessee for the Assessment Year 2012-13 is allowed. - Decided in favour of assessee. - ITA No.446/Ind/2017 - - - Dated:- 30-4-2019 - Kul Bharat, Judicial Member And Manish Borad, Accountant Member For the Assessee : Shri Sudhir Padliya ,CA For the Revenue : Shri B.J. Boricha, Sr.DR ORDER PER MANISH BORAD, AM. This appeal is filed at the instance of the assessee pertaining to Assessment Year 2012-13 and is directed against the order of Ld. Commissioner of Income Tax(Appeals)-II (in short CIT(A) ), Indore dated 02.03.2017 which is arising out of the order u/s 271(1)(c) of the Income Tax Act 1961(In short the Act ) dated 29.04.2015 framed by ITO-5(3), Indore. 2. The assessee has raised following grounds of appeal; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A.O treated this loan amount as dividend u/s 2(22)(e ) of the Act and added to total income of the assessee and assessment completed u/s 143(3) of the Act by assessing total income at ₹ 8,93,500/- (loss of ₹ 6,24,742/-). Penalty proceedings u/s 271(1)(c ) at ₹ 12,50,000/- was initiated. Aggrieved assessee preferred appeal before Ld. CIT(A) but failed to succeed. 4. Aggrieved assessee is now in appeal before the Tribunal challenging the legality of the penalty proceedings as well as raising grounds on merits challenging the penalty levied u/s 271(1)(c) of the Act at ₹ 12,50,000/-. 5. Ld. Counsel for the assessee submitted that as per provisions of Section 271(1)(c) of the Act the penalty can be initiated either for concealing the particulars of income or for furnishing inaccurate particulars of income, whereas the Ld.A.O has not recorded any charge on the assessee, as to whether penalty is to be levied for furnishing inaccurate particulars of income or concealing the particulars of income . Placing reliance on the judgment of Hon'ble Jurisdictional High Court in the case of PCIT Vs Kulwant Singh Bhatia ITA No.9 of 2018 dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h under section 139(1) or by a notice given under section 139(2)/148 of the Income Tax Act, 1961, No.________dated _____ or have without reasonable cause failed to furnish it within the allowed and the manner required by the side section 139(1) or by such notice. ** Have without reasonable cause failed to comply with a notice under section 22(4)/23(2) of the India Income tax Act, 1922 or under section 142(1)/143(2) of the Income Tax Act, 1961. **Have concealed the particulars of your income or furnished inaccurate particulars of such income. You are hereby requested to appear before me on 10/4/2015 at 11.30 AM/P.M and show cause why an order imposing a penalty on you should not be made under section 271(1)(c ) of the Income Tax Act 1961 if you do not wish to avail yourself of this opportunity of being heard in person of through authorized representative you may show cause in writing on or before the side date which will be considered before any such order is made under section 271(1)(c ). Sd/- ( DINESH SHRIVASTAVA)) 1ncome Tax Officer-5(3), Indore 9. From perusal of the above sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sir / Madam, Sub:- Penalty proceeding u/s .. 271( 1 ) ( c) .. of the Income Tax Act 1961 for the AY 2008.09 In connection with the penalty proceedings u/s, 271(1) (c) for the assessment year(s) 2008-09 you are requested to attend my office on 18.01. 2010 at 11.00 AM to show cause why penalty should not be imposed. However. if you do not wish to be heard in person in this regard, you may submit your written submissions so as to reach me by the above date which will be considered before disposal of the matter. Sd/- ( Shrlkant Namdeo ) Deputy Gommissfsoner Of1ncome Tax-1(1}, Bhopal Bhopal 13. From perusal of the above show cause notice we find that the Ld.A.O has merely mentioned the section but the specific charge i.e. whether the penalty have been initiated for concealment of particulars of income or for furnishing inaccurate particulars of income has not been mentioned. Now whether such type of notice which does not speak about the specific charge leveled against the assessee is valid and tenable in the eyes of law needs to be examined. 14. We find ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rcumstances of the case are of the considered view that the alleged notice issued u/s 274 r.w.s. 271(1)(c) of the Act dated 31.12.10 is invalid, untenable and suffers from the infirmity of non application of mind by the Assessing Officer. We accordingly direct to delete the penalty of ₹ 16,00,000/- imposed u/s 271(1)(c) on this ground itself. We accordingly allow the additional ground raised by the assessee on the legality of the penalty proceedings initiated u/s 271(1)(c) of the Act. Since the penalty u/s 271(1)(c) also has been dealt on the preliminary points other arguments of the assessee dealing with the merits of the levy of penalty are not been dealt with, as the same are rendered academic in nature and the appeal of the assessee for the Assessment Year 2008-09 is allowed . 11. We therefore respectfully following above referred judgments and in the given facts and circumstances of the case are of the considered view that the alleged notice issued u/s 271(1)(c) of the Act dated 29.04.2015 is invalid, untenable and suffers from the infirmity of non application of mind by the Assessing Officer. We accordingly direct to delete the penalty of ₹ 12,50,00 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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