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TMI Blog2022 (7) TMI 851X X X X Extracts X X X X X X X X Extracts X X X X ..... or concealment of particulars of income or for furnishing of inaccurate particulars of income. Ratio of the full bench decision of the Hon'ble Bombay High Court (Goa) squarely applies to the facts of the assessee's case as the notice u/s. 274 r.w.s. 271(l)(c) of the Act was issued without striking off the irrelevant portion of the limb and failed to intimate the assessee the relevant limb and charge for which the notices were issued. Thus, respectfully following the said decision we hold that the penalty order passed u/s. 271(1)(c) by the Assessing Officer is bad in law and accordingly the penalty order passed u/s. 271(l)(c) of the Act for Assessment Year 2008-09 is quashed - Decided in favour of assessee. - I.T.A No. 9058/Del/2019 - - - Dated:- 14-7-2022 - Shri Challa Nagendra Prasad, Judicial Member And Shri Pradip Kumar Kedia, Accountant Member For the Assessee : Shri Jeetan Nagpal, C. A.; And Ms. Pallavi, C. A. For the Department : Shri Abhishek Kumar, Sr. D. R.; ORDER PER C. N. PRASAD, J. M. : 1. This appeal is filed by the assessee against the order of the ld. Commissioner of Income Tax (Appeals)-XXV [hereinafter referred to CIT (Appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... surance Co. Ltd. 432 ITR 84 (Del.); ii) CIT Vs. SSA s Emerald Meadows (2016) 73 taxmann.com 241 (Kar.); iii) CIT Vs. Manjunatha Cotton Ginning Factory 359 ITR 565 (Kar.) 4. Referring to the above judgments, 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 pursuant to such notice is bad in law. On the other hand, the Ld. DR referring to the assessment order submits that the penalty was levied for the concealment of particulars of income. 5. Heard rival submissions perused the orders of the authorities below and the decisions relied on. On perusal of the notices issued u/s 274 read with section 271(1)(c) of the Act we observe that the notice was issued stereotyped and the Assessing officer has not specified any limb or charge for which the notice was issued i.e., either for concealment of particulars of income or furnishing of inaccurate particulars 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 t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing in the notice [has not] impaired or prejudiced the right of the assessee to a reasonable opportunity of being heard . It went onto observe that for sustaining the piea of natural justice on the ground of absence of opportunity, it has to be established that prejudice is caused to the concerned person by the procedure followed . Kaushalya doses the discussion by observing that the notice issuing is an administrative device for informing the assessee about the proposal to levy penalty in order to enable him to explain as to why it should not be done , 185. No doubt, there can exist a case where vagueness and ambiguity in the notice can demonstrate non-application of mind by the authority and/or ultimate prejudice to the right of opportunity of hearing contemplated under section 274. So asserts Kaushalya. In fact, for one assessment year, it set aside the penalty proceedings on the grounds of non-application of mind and prejudice. 186. That said, regarding the other assessment year, it reasons that the assessment order, containing the reasons or justification, avoids prejudice to the assessee. That is where, we reckon, the reasoning suffers. Kaushalya's insistence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 cause notices as betraying non-application of mind and disapproves of the practice, to be particular, of issuing notices in printed form without deleting or striking off the inapplicable parts of that generic notice. Conclusion: We have, thus, answered the reference as required by us; so we direct the Registry to place these two Tax Appeals before the Division Bench concerned for further adjudication. 7. As could be seen from the above the Hon'ble Bombay High Court (Full Bench at Goa) in the case of Mr. Mohd. Farhan A. Shaikh v. ACIT [(2021) 434 ITR 1 (Bom)] 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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