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TMI Blog2023 (10) TMI 303X X X X Extracts X X X X X X X X Extracts X X X X ..... are separate and distinct from each other. Whereas the concealment limb refers to additions towards items of income not shown by the assessee; and the limb of furnishing of inaccurate particulars of income would, inter alia, refer to disallowance of expenses claimed by the assessee as deductible. Additions made under both the limbs eventually give a foundation for imposition of penalty u/s. 271(1)(c), subject to the fulfilment of requisite conditions of the section. One cannot say that disallowance of expenses has resulted into `concealment of income for furnishing of inaccurate particulars of income . The third category created by the ld. CIT(A) does not find its presence in any part of the provision. Qua one addition, it can either be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... td. [ 2020 (2) TMI 333 - BOMBAY HIGH COURT] - The SLP of Department against this judgment has since been dismissed in PCIT vs. Golden Peace Hotels and Resorts (P.) Ltd. [ 2021 (3) TMI 195 - SC ORDER] . It is unambiguous from the above enunciation of law that the issuance of a lawful notice u/s 274, clearly setting out the charge for which the penalty is proposed to be levied, is sine qua non, for passing a valid penalty order. Where notice u/s 274 is vague, penalty order gets vitiated. Adverting to the facts of the instant case, we find that the assessee ought to have been visited with the penalty on the charge of furnishing of inaccurate particulars of income. As against that, the penalty order was passed with reference to both, namely ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hether it was a case of furnishing of inaccurate particulars of income or concealment of particulars of income. The ld. CIT(A) held that there are three limbs of the penalty u/s. 271(1)(c), namely, (i) concealment of the particulars of income; (ii) furnishing of inaccurate particulars of income; and (iii) concealment of particulars of income and furnishing of inaccurate particulars of income co-existing. He thus concluded that the case of the assessee was covered under the third limb. The assessee is before the Tribunal. 3. We have heard the ld. DR and gone through the relevant material on record. There is no appearance from the side of assessee despite notice. It is seen that there is only one addition made in the assessment order and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e cannot say that disallowance of expenses has resulted into `concealment of income for furnishing of inaccurate particulars of income . The third category created by the ld. CIT(A) does not find its presence in any part of the provision. Qua one addition, it can either be a case of concealment of particulars of income or furnishing of inaccurate particulars of income. The action of the AO in initiating and passing the order on both the limbs together, can be justified if there are two or more additions made by him - some of them falling in realm of the first limb and others in the second. Howbeit, if there is only one item of addition, that can be either a case of concealment of particulars of income or furnishing of inaccurate particulars ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vied, is sine qua non, for passing a valid penalty order. Where notice u/s 274 is vague, penalty order gets vitiated. 6. Adverting to the facts of the instant case, we find that the assessee ought to have been visited with the penalty on the charge of furnishing of inaccurate particulars of income. As against that, the penalty order was passed with reference to both, namely, furnishing of inaccurate particulars of income and concealment as well. Under these circumstances, we are satisfied that the order passed by the ld. CIT(A) cannot be sustained. The same is, therefore, overturned and the penalty is directed to be deleted. 7. In the result, the appeal is allowed. Order pronounced in the Open Court on 06th October, 2023. - - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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