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TMI Blog2019 (10) TMI 131X X X X Extracts X X X X X X X X Extracts X X X X ..... tant For the Assessee : Shri Anil Khandelwal, CA For the Revenue : Shri Rajeeb Kumar, Sr.DR ORDER PER MANISH BORAD, AM. The above captioned appeals are filed at the instance of assessee pertaining to Assessment Years 2008-09, 2011-12 2013-14 are directed against the orders of Ld. Commissioner of Income Tax (Appeals)-III (in short Ld.CIT(A) ], Indore dated 13.06.2018 which are arising out of the order u/s 271(1)(c) of the Income Tax Act 1961(In short the Act ) dated 28.09.2016 framed by DCIT (Central)-1, Indore. 2. Assessee has raised following grounds of appeal; ITA No.682/Ind/2018 Assessment Year 2008-09 (1) On the facts and in the circumstances of the case Ld. CIT (A) III erred in law in imposing penalty on wrong assumptions based on patently wrong facts while confirming levy of penalty u/s 271(1)(c) and application of explanation. 5 A of section 271(1)(c) thereon. (2) 0n the facts and in the circumstances of the case Ld. CIT (A) III erred in heavily relying on the seized document BS-16 though ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... levied U/S 271 (1) (c) in view of the fact that [earned A.O. did not consider BS - 16 in penalty order. (3) On the facts and in the circumstances of the case, Ld. CIT (A)III committed breach of natural justice while considering seized BS-16 in not giving opportunity to appellant to explain her stand effectively on the same, causing prejudice to appellant. (4) On the facts and in the circumstances of the case Ld. CIT (A)-III erred in law and on facts in confirming penalty levied U/S 271(1) (c). (5) Appellant reserves right to add, alter, amend only grounds of appeal. 3. As the issues raised in both the appeals are similar in nature relating to the same assessee they are heard together and being disposed off for sake of convenience and brevity. 4. During the course of hearing Ld. Counsel for the assessee raised additional legal ground challenging the validity of notice issued u/s 274 r.w.s. 271(1)(c) of the Act of the Act claiming it to be illegal and bad in law. We find that though the assessee has not raised the legal ground at the time of filing the appeal but in our considered opinion and followi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s 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 judgments mentioned in the written submission which mainly includes judgment of jurisdictional High Court in the case of PCIT Vs Kulwant Singh Bhatia ITA No.9 of 2018 dated 9.5.2018, the Ld. Counsel for the assessee contended that the Ld.A.O has failed in comply the provisions of section 271(1)(c) of the Act by initiating the penalty proceedings with no specific charge. Reliance was also placed on Indore Tribunal decision in the case of Varad Mehta V/s DCIT-1 Bhopal ITA No.693/Ind/16 dated 06.12.2018. 9. Per contra Departmental Representative vehemently argued supporting the orders of lower authorities. 10. We have heard rival contentions and perused the records placed before us. The issues raised by the assessee revolves around the levy of penalty u/s 271(1)(c)at ₹ 50,000/-, ₹ 2,10,000/- and ₹ 2,60,000/-. The assessee raised a legal issue pleading that Ld. A.O has wrongly initiated the penalty proceedings by not specifying ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is issued to provide opportunity of being heard to the assesse. Sd/- ( Avaneesh Tiwari ) Deputy GommissfsonerOf1ncome Tax-(Central)-1 Indore 12. From perusal of the above show cause notices 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 in light of judicial precedents. 13. We find that similar issue came up for adjudication before us in the case of Varad Mehta ITA No.693/Ind/16 dated 06.12.2018 (supra) wherein we have decided the issue in favour of the assessee after relying on the judgment of jurisdictional High Court in the case of Shri Kulwant Singh Bhatia (supra) observing as follows. Relevant extract of our decision is reproduced below; 14. We find that similar issue came up before the jurisdictional High Court in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 . 14. 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 274 r.w.s. 271(1)(c) of the Act dated 22.03.2016 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 at ₹ 50,000/-, ₹ 2,10,000/- and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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