9911796707
TMI Blog2016 (11) TMI 1728X X X X Extracts X X X X X X X X Extracts X X X X ..... enalty could not be sustained. In CIT vs. Smt. Kaushalya [ 1995 (1) TMI 25 - BOMBAY HIGH COURT] has held that The vagueness and ambiguity in the notice had also prejudiced the right of reasonable opportunity of the assessee since he did not know what exact charges he had to face. In this background, quashing of the penalty proceedings for the assessment year 1967-68 seems to be fully justified. We hold that the notice issued by the AO u/s 274 r.w.s. 271 for the AY 2003-04 for initiating penalty proceeding u/s 271(1)(c) of the Act in the present case is invalid. The order of the CIT(A) directing the AO to impose penalty u/s 271(1)(c) is thus set aside. Appeal filed by the assessee is allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... visions of the Act. 3. In a nutshell, the facts are that search and seizure action u/s 132(1) of the Act was carried out by the Department in the case of Felmingo/Bermaco Group on 31/10/2009. The assessee's case was covered u/s 153C of the Act. The assessee filed its return of income on 11/08/2010 in response to notice u/s 153C of the Act, declaring Nil income. However, in the computation of capital income, the assessee claimed agricultural loss of Rs. 44,35,817/-. The AO completed the assessment u/s 153C r.w.s 143(3) on 27/12/2011 by making addition on account of diminution in value of investment of Rs. 25,60,558/- and treating the agricultural income/ receipts as income from other sources. Then the AO imposed a penalty of Rs. 25,09,949/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he ld. counsel of the assessee that the order passed by the AO u/s 271(1)(c) is bad in law as the notice issued u/s 274 r.w.s 271 of the Act did not specify whether the penalty was initiated for concealment of income or furnishing inaccurate particulars thereof. 5. The ld. DR supports the order passed by the ld. CIT(A) upholding the penalty of Rs. 25,09,949/- imposed by the AO u/s 271(1)(c) of the Act. 6. We have considered the rival submissions and perused the relevant material on record. We find in the notice u/s 274 r.w.s.271 dated 27/12/2011, the AO has mentioned 'have concealed the particulars of your income or-------furnished inaccurate particulars of such Income.' The said notice has been filed by the ld. counsel of the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a notice as to penalty order or framing of charge in a criminal case or a quasi-criminal case, but it was incumbent upon the Inspecting Assistant Commissioner to come to a positive finding as to whether there was concealment of income by the assessee or whether any inaccurate particulars of such income had been furnished by the assessee. No such clear-cut finding was reached by the Inspecting Assistant Commissioner and, on that ground alone, the order of penalty passed by the Inspecting Assistant Commissioner was liable to be struck down." (p. 310) 6.3 In New Sorathia Engg. Co vs. CIT [2006] 155 TAXMAN 513 (Guj.), it has been held by the Hon'ble Gujarat High Court that 'where penalty order and order of Commissioner (Appeals) showed t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
