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TMI Blog2022 (8) TMI 1176X X X X Extracts X X X X X X X X Extracts X X X X ..... H , ACCOUNTANT MEMBER Appellant by : Vipul Joshi Respondent by : Achal Sharma ORDER Per Amarjit Singh (AM): The present appeal filed by the revenue is directed against the order passed by the CIT(A)-16, Mumbai, which in turn arises from the order passed by the A.O u/s 143(3) of the Act for A.Y.2012-13. The revenue has raised the following grounds before us: 1. Whether on the facts and in the circumstances of the case and in law, the Ld.CIT(A) erred the fact that the assessee repeatedly ignoring the findings of Tax Auditor about the inadmissibility of expenses for AY 2012-13 and 2013-14 and claimed inadmissible expenses not only in the instant year but also in preceding year? 2. Whether on the facts and in the circumstances of the case and in law, the Ld.CIT(A) erred in deleting the penalty of Rs. 3.18,94,000/- in the instant case ignoring the provisions of section 271(1)(c) of the Act? 3. The appellant prays that the order of the Ld.CIT(A) on the above ground be set aside and that of the AO be restored. 4. The appellant craves leave to amend or alter any grounds or add a new ground which may be necessary. 2. The brief fact is that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nution in the value of investment, Rs.16,00,000/- on account of prior period expenditure on which the A.O had levied penalty of Rs. 3,18,94,000/- u/s 271(1)(c) of the Act. During the course of appellate proceedings before us the ld. counsel has submitted that A.O had not struck off the irrelevant portion in the notice issued u/s 274 of the Act dated 29.03.2015. He also submitted that ld. CIT(A) has also not adjudicated its ground pertaining to the notice issued, without specifying limb of Sec.271(1)(c) of the Act. In this regard we have perused the order of ld. CIT(A) passed on 31.07.2019 and noticed that at para no. 3 of the order under the ground no. 2 the ld. CIT(A) has mentioned that notice not specified the limb of u/s 271(1)(c) of the Act. However, the ld. CIT(A) has not given specific finding on the issue of not specifying the limb of Section 271(1)(c) in the above referred notice issued u/s 274 of the Act. The assessee has placed copy of the notice issue u/s 274 r.w.s 271(1)(c) of the Act dated 29.03.2015 as annexure in the paper book submitted on 06.04.2022. We have perused the copy of notice placed in the paper book the relevant part of the same reproduced as under: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Full Bench decision of the Hon ble Jurisdictional High Court in the case of Mohd. Farhan A Shaikh vs. DCIT reported in 434 ITR 1 (Bom). The relevant portion of the said order is reproduced hereunder:- 181. It does. The primary burden lies on the Revenue. In the assessment proceedings, it forms an opinion, prima facie or otherwise, to launch penalty proceedings against the assessee. But that translates into action only through the statutory notice under section 271(1)(c), read with section 274 of IT Act. True, the assessment proceedings form the basis for the penalty proceedings, but they are not composite proceedings to draw strength from each other. Nor can each cure the other's defect. A penalty proceeding is a corollary; nevertheless, it must stand on its own. These proceedings culminate under a different statutory scheme that remains distinct from the assessment proceedings. 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 an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtions of the printed notices are not struck off ? 187. In Dilip N. Shroff case (supra), 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 N. Shroff case (supra), on facts, has felt that the assessing officer himself was not sure whether he had proceeded on the basis that the assessee had concealed his income or he had furnished inaccurate particulars. 188. We may, in this context, respectfully observe that a contravention of a mandatory condition or requirement for a communication to be valid communication is fatal, with no further proof. That said, even if the notice contains no caveat that the inapplicable portion be deleted, it is in the interest of fairness and justice that the notice must be precise. It should give no room for ambiguity. Therefore, Dilip N. Shroff Case (supra) disapproves of the routine, ritualistic practice of issuing omnibus show-cause notices. That practice certainly betrays non- application of mind. And, therefore, the i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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