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TMI Blog2022 (1) TMI 981X X X X Extracts X X X X X X X X Extracts X X X X ..... to initiate the penalty proceedings against the assessee goes to prove that the AO himself was not aware / sure as to whether he is issuing notice to initiate the penalty proceedings either for concealment of particulars of income or furnishing of inaccurate particulars of such income by the assessee rather issued vague and ambiguous notice by incorporating both the limbs of section 271(1)(c). When the charge is to be framed against any person so as to move the penal provisions against him/her, he/she is required to be specifically made aware of the charges to be leveled against him/her. Following the decisions rendered in the cases of CIT vs. Manjunatha Cotton and Ginning Factory [ 2013 (7) TMI 620 - KARNATAKA HIGH COURT] , CIT vs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... though it is a speculative loss, holding that the genuineness of this loss is not in dispute. 2. The CIT (A) has erred in deleting the penalty ignoring the fact that the speculative loss was due to trading in derivatives and wrong claim of it as business loss cannot be bonafide because its main business is sugar export the claim cannot be because of oversight but is an act of commission. 2. Briefly stated the facts necessary for adjudication of the controversy at hand are : On the basis of assessment framed under section 143 (3) of the Income-tax Act, 1961 (for short the Act ), business income was assessed at ₹ 6,77,68,473/- as against loss of ₹ 2,17,28,499/- shown in the return of income and after making broug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c)/274 of the Act if the assessee has concealed the particulars of income or has furnished inaccurate particulars of income and relied upon the decisions of Hon ble Karnataka High Court in CIT vs. SSA s Emerald Meadows -73 taxmann.com 241 (Kar.) (Revenue s SLP dismissed in 242 taxman 180) and Hon ble High Court of Delhi in Pr. CIT vs. Sahara India Life Insurance Company Ltd. in ITA 475/2019 order dated 02.08.2019. Ld. AR for the assessee further contended that when there is returned income/assessed income under MAT then no penalty is leviable for additions/disallowances made under the normal provisions and relied upon the decision rendered by Hon ble Delhi High Court in case of CIT vs. Nalwa Sons Investments Ltd. (2010) 327 ITR 543. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it appears to me that you:- Have without reasonable cause failed to comply with a notice under section 142(1)/143(2) of the Income Tax Act, 1961 dated Have concealed the particulars of your income or furnished inaccurate particulars of such income in terms of explanation 1, 2,3,4 and 5. You are hereby requested to appear before me at 11.30 AM/PM on 23.02.2013 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 heard in person or through authorized representatives you may show cause in writing on or before the said date which will be considers before any such order is made under section 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icer under section 274 read with section 271 (1 )(c) was bad in law, as it did not specify under which limb of section 271 (1 )(c) penalty proceedings had been initiated, i.e., whether for concealment of particulars of income or furnishing of inaccurate particulars of income - High Court held that matter was covered by aforesaid decision of Division Bench and, therefore, there was no substantial question of law arising for determination - Whether since there was no merit in SLP filed by revenue, same was liable to be dismissed - Held, yes [Para 2] [In favour of assessee] 12. Hon ble Delhi High Court in case of Pr. CIT vs. Sahara India Life Insurance Company Ltd. (supra) while deciding the identical issue held as under :- 21. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... basis of disallowances or additions as has been held by Hon ble Delhi High Court in case of CIT vs. Nalwa Sons Investments Ltd. (supra) by returning following findings :- Under the scheme of the Income-tax Act, 1961, the total income of the assessee is first computed under the normal provisions of the Act and tax payable on such total income is compared with the prescribed percentage of the book profits computed under section 115JB of the Act. The higher of the two amounts is regarded as total income and tax is payable with reference to such total income. If the tax payable under the normal provisions is higher, such amount is the total income of the assessee, otherwise, the book profits are deemed as the total income of the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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