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TMI Blog2022 (4) TMI 35X X X X Extracts X X X X X X X X Extracts X X X X ..... lt in the SCN , dated 30.03.2013, had left the assessee guessing of the default for which it was being proceeded against. In the backdrop of our aforesaid observations, we are of a strong conviction, that as the A.O had clearly failed to discharge his statutory obligation of fairly putting the assessee company to notice as regards the default for which it was being proceeded against, therefore, the penalty under Sec. 271(1)(c) imposed by him being in clear violation of the mandate of Sec. 274(1) of the Act cannot be sustained. We, thus, for the aforesaid reasons not being able to persuade ourselves to subscribe to the imposition of penalty by the A.O, therefore, set-aside the order of the CIT(A) who had upheld the same. - Appeal of assessee allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of the Act. After culmination of the assessment the Assessing Officer vide his order passed u/s.271(1)(c) of the Act, dated 30.09.2013 imposed penalty of ₹ 6,92,757/- on the assessee. 3. Aggrieved, the assessee assailed the order of the Assessing Officer passed u/s.271(1)(c) of the Act before the CIT(Appeals). However, the CIT(Appeals) not finding favor with the contentions advanced by the assessee upheld the penalty imposed by the Assessing Officer and dismissed the appeal. 4. The assessee being aggrieved with the order of the CIT(Appeals) has carried the matter in appeal before us. 5. At the very outset of the hearing of appeal, it was submitted by the Ld. Authorized Representative (for short 'AR') for the assessee that the Assessing Officer had wrongly assumed jurisdiction and saddled the assessee with the impugned penalty u/s 271(1)(c) of the Act. Elaborating on his aforesaid contention, it was submitted by the Ld. AR that as the Assessing Officer had failed to strike off the irrelevant default in the body of the 'Show Cause' Notice (SCN), dated 30.03.2013, therefore, the assessee had remained divested of an opportunity of putting forth his case that no penalty was l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it was called upon to explain as to why penalty under Sec. 271(1)(c) may not be imposed on it. As observed by us hereinabove, a perusal of the 'Show cause' notice issued in the present case by the A.O under Sec. 274 r.w. Sec. 271(1)(c), dated 30.03.2013 clearly reveals that there was no application of mind on the part of the A.O while issuing the same. We are of a strong conviction that the very purpose of affording a reasonable opportunity of being heard to the assessee as per the mandate of Sec. 274(1) would not only be frustrated, but would be rendered as redundant if an assessee is not conveyed in clear terms the specific default for which penalty was sought to be imposed. In our considered view, the indispensable requirement on the part of the A.O to put the assessee to notice as regards the specific charge contemplated under the aforesaid statutory provision, viz. 'concealment of income' or 'furnishing of inaccurate particulars of income' is not merely an idle formality but is a statutory obligation cast upon him, which we find had not been discharged in the present case as per the mandate of law. 9. We would now test the validity of the aforesaid 'Show Cause' notice and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the principles of natural justice [See Malabar Industrial Co. Ltd. Vs. CIT (2000) 2 SCC 718]. We are of the considered view, that now when as per the settled position of law the two defaults, viz. 'concealment of income' and 'furnishing of inaccurate particulars of income' are separate and distinct defaults, therefore, in case the A.O sought to have proceeded against the assessee for either of the said defaults, then, it was incumbent on his part to have clearly specified his said intention in the 'Show cause' notice, which we find he had failed to do in the case before us. The aforesaid failure on the part of the assessee cannot be dubbed as merely a technical default, because the same had clearly divested the assessee of its statutory right of being heard and defend its case. 10. We find that the Hon'ble High Court of Karnataka in the case of CIT Vs.SSA's Emerald Meadows (73 taxmann.com 241)(Kar) following its earlier order in the case of CIT Vs. Manjunatha Cotton and Ginning Factory (2013) 359 ITR 565 (Kar), had held, that where the notice issued by the A.O under Sec. 274 r.w Sec. 271(1)(c) does not specify the limb of Sec. 271(1)(c) for which the penalty proceedings had ..... X X X X Extracts X X X X X X X X Extracts X X X X
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