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TMI Blog2019 (8) TMI 1056X X X X Extracts X X X X X X X X Extracts X X X X ..... t was not the fault of the assessee. The assessee has submitted that income was duly offered in the next year even before the initiation of assessment proceedings. He relied on the judgement of Hon'ble apex court rendered in the case of Price Water Home Cooper Pvt. Ltd. Vs. CIT [2012 (9) TMI 775 - Supreme Court ] Looking to the peculiarity of facts of the present case and coupled with the fact that after discovering the mistake offered income for tax in the subsequent year. Under these facts, levy of penalty would not be justified. Therefore, respectfully following the judgement of Hon'ble Supreme Court in the case of Price Water Home Cooper Pvt. Ltd. Vs. CIT[ 2012 (9) TMI 775 - Supreme Court ] we hereby direct the A.O. to delete penalty. This ground of assessee s appeal is allowed. - ITA No.219/Ind/2018 - - - Dated:- 21-8-2019 - Shri Kul Bharat, Judicial Member And Shri Manish Borad, Accountant Member For the Appellant : Shri Sumit Nema, Sr. Adv. And Shri Ayush Gupta, Adv. For the Revenue : Shri Amit Kumar Soni, Sr. DR ORDER PER KUL BHARAT, J.M: This is an appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Central Government to construct Bridges and Roads. The return of income for A.Y. 2013-14 was filed on 18.09.2013 declaring total income of ₹ 53,12,100/-. The case was selected for scrutiny assessment and the assessment u/s 143(3) of the Income Tax Act 1961(hereinafter called as the Act ) was framed vide order dated 16.11.2015. Thereby, assessing income at ₹ 58,95,290/- hence an addition of ₹ 4,73,709/- on account of difference between the declared interest income and income as reflected in Form-26AS. The Assessing Officer also initiated penalty proceedings u/s 271(1)(c) of the Act. Subsequently, penalty u/s 271(1)(c) of the Act was imposed on some of ₹ 25.05.2016. 3. Aggrieved by this the assessee preferred an appeal before the Ld. CIT(A) who after considering the submissions dismissed the appeal and sustained the penalty. 4. Now, the assessee is in present appeal. 5. Ground Nos. 1 to 4 are against legality of levy of penalty. Ld. Senior Counsel Shri Sumit Nema, argued that the authorities below have not followed the provisions of law correctly. Hence, initiation of penalty proceeding and levy of penalty i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... through the orders of the authorities below. The assessee has assailed the penalty order both on legal ground as well as on merit. It is the contention of the assessee that the initiation of penalty proceedings u/s 271(1)(c) of the Act is bad in law. As the A.O. has not recorded the requisite satisfaction and also issued notice u/s 271(1)(c) of the Act is defective as no specific charge is mentioned. It is argued on behalf of the assessee that in the light of the judgement of the Hon'ble jurisdictional High Court rendered in the case of PCIT Vs. Kulwant Singh Bhatia (supra), penalty cannot be sustained. He further submitted that under the identical facts, this Tribunal has quashed the penalty order in catena of cases following the judgement of the Hon'ble jurisdictional High Court. Further, it is contended that looking to the facts of the present case, penalty cannot even be sustained on merit. 9. We have given our thoughtful consideration to the facts of the case law cited and argument advanced by the respective representatives of the parties. Before adverting the rival submissions, the relevant provision of law are reproduced as under for the sake of cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pugned notice is reproduced as under: 11. From the above, it is evident that notice so issued does not disclose any charge. This was not so in the case before the Hon'ble Karnataka High Court. In that case, notice was for both the charges. However, we find that no such objection was raised before the authorities below by the assessee. Hon'ble Karnataka High Court in the case of Sundaram Finance Limited Vs. ACIT (supra) has held as under: 14. With regard to the third substantial question of law, which has been framed for consideration, firstly we wish to point out that such a contention was never raised by the assessee at any point of time. The argument of the learned counsel for the petitioner is that this being a question of law can be allowed to be raised at this stage. To support his contention, learned counsel placed reliance on the decision in Jindal Equipments Leasing and Consultancy Services Ltd., case. We find that the said decision does not in any manner assist the cse of the assessee for the reason that the contention before the High Court of Karnataka was that initially a question of law was raised with reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otice, it had caused no prejudice to the assessee and the assessee clearly understood what was the purport and import of notice issued under section 274 r/w section 271 of the Act. Therefore, principles of natural justice cannot be read in abstract and the assessee, being a limited company, having wide network in various financial services, should definitely be precluded from raising such a plea at this belated stage. 17. Thus, for the above reasons, substantial questions of law Nos.1 and 2 are answered against the assessee and in favour of the revenue. The additional substantial question of law, which was framed is rejected on the ground that on facts the said question does not arise for consideration as well as for the reasons set out by us in the preceding paragraphs. 12. In the light of the judgement of the Hon'ble Karnataka High Court (supra), the plea of the assessee regarding notice being defective cannot be entertained at this stage. As in the present case as well the Assessee did not object against the notice being defective rather it filed reply making averments on merit. The assessee ought to have objected agai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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