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TMI Blog2022 (3) TMI 344X X X X Extracts X X X X X X X X Extracts X X X X ..... culars of such income. It can be seen from the notice issued u/s 274 read with section 271(1)(c) of the Act, Assessing Officer did not strike off irrelevant limb in the notice specifying the charge for which notice was issued. As decided in MR. MOHD. FARHAN A. SHAIKH .[ 2021 (3) TMI 608 - BOMBAY HIGH COURT] while dealing with the issue of non-strike off of the irrelevant part in the notice issued u/s.271(l)(c) of the Act, held that assessee must be informed of the grounds of the penalty proceedings only through statutory notice and an omnibus notice suffers from the vice of vagueness. Thus notice u/s. 274 r.w.s. 271(1)(c) of the Act were issued without striking off the irrelevant portion of the limb and failed to intimate the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hall be levied or collected except by authority of law . Penalty levied on illegal assessment be annulled. 3. That the Ld. AO and CIT(A) have both erred in law and on facts in levy of illegal penalty, for illegal assessment made without timely service of notice u/s 143(2) of the Act. First notice served by affixture on 24th December 2004, was beyond the time limit, penalty so levied be deleted. 2. The Ld. Counsel for the assessee submits that the additional grounds raised are purely legal grounds and verification of any fresh facts by the Ld. Assessing Officer. Therefore, placing reliance on the decision of the Hon ble Supreme Court in the case of National Thermal Power Company Ltd. Vs. CIT reported in 229 ITR 383 (SC) the Ld. Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in the case of Dilip N Shroff reported in 291 ITR 519: 5. Referring to the above judgment, Ld. Counsel for the assessee submitted that since the notices issued u/s 274 read with section 271(1)(c) of the Act did not specify the limb for which or the charge for which it was issued the penalty order passed pursuit to such notice is bad in law. On the other hand, the Ld. DR strongly supported the orders of the authorities below. 6. Heard rival submissions perused the orders of the authorities below and the decisions relied on. On perusal of the notice issued u/s 274 read with section 271(1)(c) of the Act we observe that the notice issued was stereotyped and the Assessing officer has not specified any limb or charge for which the notice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. Therefore, the assessee must be informed of the grounds of the penalty proceedings only through statutory notice. An omnibus notice suffers from the vice of vagueness. 182. More particularly, a penal provision, even with civil consequences, must be construed strictly. And ambiguity, if any, must be resolved in the affected assessee's favour. 183. Therefore, we answer the first question to the effect that Goa Dourado Promotions and other cases have adopted an approach more in consonance with the statutory scheme. That means we must hold that Kaushaiya does not lay down the correct proposition of law. Question No.2: Has Kaushaiya failed to discuss the aspect of 'prejudice? 184. Indeed, Kaushaiya did discuss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , avoids prejudice to the assessee. That is where, we reckon, the reasoning suffers. Kaushalya's insistence that the previous proceedings supply justification and cure the defect in penalty proceedings has not met our acceptance. Question No. 3: What is the effect of the Supreme Court's decision in Dilip N. Shroff on the issue of non-application of mind when the irrelevant portions of the printed notices are not struck off ? 187. In DUip N. Shroff, for the Supreme Court, it is of some significance that in the standard Pro-forma used by the assessing officer in issuing a notice despite the fact that the same postulates that inappropriate words and paragraphs were to be deleted, but the same had not been done . Then, Dilip ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion is mandatory and brooks no trifling with or dilution. For a further precedential prop, we may refer to Rajesh Kumar v. CIT[74], in which the Apex Court has quoted with approval its earlier judgment in State of Orissa v. Dr. Binapani Dei[ 75]. According to it, when by reason of action on the part of a statutory authority, civil or evil consequences ensue, principles of natural justice must be followed. In such an event, although no express provision is laid down on this behalf, compliance with principles of natural justice would be implicit. If a statue contravenes the principles of natural justice, it may also be held ultra vires Article 14 of the Constitution. 191. As a result, we hold that Dilip N. Shroff treats omnibus show caus ..... X X X X Extracts X X X X X X X X Extracts X X X X
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