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TMI Blog2019 (3) TMI 1650X X X X Extracts X X X X X X X X Extracts X X X X ..... of mind on the part of the Assessing Officer. Even in the order imposing penalty, the Assessing Officer mentioned both limbs. In our view it is mandatory on the part of the AO to specifically state the particular charge on which penalty is proposed to be levied and non-striking off of the irrelevant limb will go to the root of Jurisdiction of the Assessing Officer to pass penalty order. In the case of Manjunath Cotton Ginning Factory [ 2013 (7) TMI 620 - KARNATAKA HIGH COURT] And M/s. SSA s Emerald Meadows [ 2015 (11) TMI 1620 - KARNATAKA HIGH COURT] - Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... issued for concealment of particulars of income or furnishing of inaccurate particulars of income meaning thereby that notice was issued in a standard format. Finally the penalty was imposed vide order dated 30.09.2013 at ₹ 2,52,78,363/- equal to 100% of the tax sought to be evaded by invoking Explanation-1 to section 271(1)(c) of the Act for concealment of particulars of income to the tune of ₹ 7,43,70,000/-. 5. In the penalty proceedings, the assessee submitted that the said loss has resulted from the sale of 13,32,000 shares of M/S. SKS Ispat and Power Ltd. of face value of 10/- each at a premium of ₹ 50/-. The assessee submitted before the AO that the said company was setting up an integrated steel plant along with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... verstated the sale price of the shares in order to build up capital. Be that as it may, 1 find from para 4.2 of the assessment order that show cause notices were issued calling upon the appellant to produce, inter alia, copies of Share Transfer Forms, Share Certificates allotted / transfer and evidences with regard to despatch / receipt of Share Certificates for the shares transferred. I also find from para 4.3 of the order that the appellant did not fully produce all the documents called for by the AO. Para 4.3 of the assessment order is reproduced below: "4.3 The assessee filed reply to the above show-cause notice vide letter 13.03.2013 only giving details of the shares stated to have sold and working of losses. The assessee denied of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idences of the shares along with balance sheets of the assessee to prove all these transactions. The Ld. A.R. also submitted that no quantum appeal has been preferred as there was no income of the assessee in the current year or in the subsequent years and there was no adjustment/setting off in near future against the income. The Ld. A.R. also submitted that in the assessee's case the assessment was framed by the AO Shri Changanti Sanjeev, ACIT of Wealth Tax, Central Circle -45, Mumbai who was incidently happened to be the AO in the case of the M/S Vignesh Steel Pvt. Ltd. The Ld. A.R. filed before the Bench copy of the assessment order in the case of Vignesh Steel Pvt. Ltd. for A.Y. 2009-10 dated 28.03.2013 passed under section 143(3) where ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alty. Thereafter, the Ld. A.R. referred to the penalty order passed under section 271(1)(c) dated 30.09.2013 wherein the penalty was imposed by invoking Explanation-1 to section 271(1)(c). The Ld. A.R. contended that the order passed by the AO is bad in law and void ab-initio on the ground that the AO has not confronted the assessee with the particular charge i.e. whether the penalty is imposed for concealment of income or for inaccurate particulars of income thereby depriving the assessee of opportunity to respond on that limb. The ld AR agued that the principles of natural justice were violated by issuing the notice in the standard format which was issued without application mind. The Ld. A.R. relied heavily on the order of Hon'bl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cluding various decisions cited by learned AR. The undisputed facts are that the Assessing Officer while framing assessment u/s. 143(3) of the Act initiated penalty proceedings u/s. 271(1)(c) of the Act without mentioning whether the same relates to concealment of income or filing of inaccurate particulars of income. Similarly, when notice u/s. 271(1)(c) of the Act was issued on 28.03.2013 the same was issued in mechanical manner without striking off irrelevant limb and therefore there was no application of mind on the part of the Assessing Officer. Even in the order imposing penalty, the Assessing Officer mentioned both limbs. In our view it is mandatory on the part of the Assessing Officer to specifically state the particular charge on wh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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