9911796707
TMI Blog2020 (2) TMI 90X X X X Extracts X X X X X X X X Extracts X X X X ..... ing penalty is bad in law and void ab initio since in the show cause notice issued u/s 274 read with section 271 the Id. AO has not struck off the irrelevant clause of the notice, meaning thereby the AO has not apprise the assessee about the specific charge, under which assessee has been held guilty of penal action. 5. The appellant craves leave to add, alter, amend, delete, substitute any ground of appeal on or before the date of hearing." 2. Briefly stated the facts necessary for adjudication of the controversy at hand are : on the basis of assessment order framed u/s 153A/143(3) of the Income Tax Act, 1961 (for short "the Act") at an income of Rs. 2,84,85,396/- by way of making addition of Rs. 14,43,784/- and 1,50,00,000/- on account of disallowance of credit card expenses and deemed dividend respectively, initiated the penalty proceedings u/s 271(1)(c) of the Act. Declining the contention raised by the assessee AO levied the penalty to the tune of Rs. 4,21,344/- @ 100% of the tax sought to be evaded. 3. Assessee carried the matter by way of an appeal before the ld. CIT (A) who has confirmed the penalty by dismissing the appeal. Feeling aggrieved, the assessee has come up be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Assessment Year 2011-12 it appears to me that you :- * have without reasonable cause failed to furnish me return of income which you were required to furnish by a notice given under section 22(l)/22(2)/34 of the Indian Income-tax Act, 1922 or which you were required to furnish under section 139(1) or by a notice given under section 139(2)/148 of the Income-tax Act, 1961, No........ dt........... or have without reasonable cause failed to furnish it within the time allowed and the manner required by the said 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 Indian 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 28.04.2014 at 11 AM in my office at Room No. 332, E-2, ARA Centre, Jhandewalan Extension, New Delhi- 110055 and show cause why an order imposing a penalty on you should not be made under section 271 of the Income - tax Act, 1961. If you do not wish to avail yourself of this opportunity of being h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... full opportunity to meet the case of the Department and show that the conditions stipulated in Section 271 (1)( c) do not exist as such he is not liable to pay penalty. The practice of the Department sending a printed form where all the ground mentioned in Section 271 are mentioned would not satisfy requirement of law when the consequences of the assessee not rebutting the initial presumption is serious in nature and he had to pay penalty from 100% to 300% of the tax liability. As said provisions have to be held to be strictly construed, notice issued under Section 274 should satisfy the grounds which he has to meet specifically. Otherwise, principles of natural justice is offended if the show cause notice is vague. On the basis of such proceedings, no penalty could be imposed on the assessee. 60. Clause (c) deals with two specific 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v. Manu Engg. [1980] 122 ITR 306 and the Delhi High Court in the case of CIT v. Virgo Marketing (P) Ltd. [2008] 171 Taxman 156, has held that levy of penalty has to be clear as to the limb for which it is levied and the position being unclear penalty is not sustainable. Therefore, when the Assessing Officer proposes to invoke the first limb being concealment, then the notice has to be appropriately marked. Similar is the case for furnishing inaccurate particulars of income. The standard proforma without striking of the relevant clauses will lead to an inference as to non-application of mind. " 11. Hon'ble Apex Court in case of CIT vs. SSA's Emerald Meadows - (2016) 73 taxmann.com 248 (SC) while dismissing the SLP filed by the Revenue quashing the penalty by the Tribunal as well as Hon'ble High Court on ground of unspecified notice has held as under:- "Section 274, read with section 271(1)(c), of the Income-tax Act, 1961 - Penalty - Procedure for imposition of (Conditions precedent) - Assessment year 2009-10 - Tribunal, relying on decision of Division Bench of Karnataka High Court rendered in case of CIT v. Manjunatha Cotton & Ginning Factory [2013] 359 1TR 565/218 Taxman 423/35 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
