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TMI Blog2024 (5) TMI 1390X X X X Extracts X X X X X X X X Extracts X X X X ..... ELD THAT:- There is a greater onus casted on the Revenue to specifically mention in the show cause notice itself as to what offence the assessee has committed and also to mention the rate of penalty that is sought to be levied by the AO on the assessee i.e., 10% or 20% or 30% or 60% of undisclosed income, as the case may be. If none of these preliminary informations are mentioned in the show cause notice, then the show cause notice issued by the Ld. AO becomes completely defective and consequentially fatal and would vitiate the entire penalty proceedings. This issue, in any case, is no longer res integra in view of the decision of Kolkata Tribunal in the case of Sushil Kumar Paul [ 2022 (12) TMI 1008 - ITAT KOLKATA ] wherein as held there i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... siness of development of land. A search and seizure operation u/s 132 of the Income Tax Act was carried out on 23/08/2012 in M/s Landcraft Group of cases. During the course of search, statement u/s 132(4) of the Act was recorded from the Director of the assessee, wherein sum of Rs. 6,42,57,474/- and Rs. 40,00,000/- was surrendered as undisclosed income by the assessee. The sum of Rs. 6,42,57,474/- was surrendered with respect to specific income as detailed in the statement u/s 132(4) of the Act and Rs. 40,00,000/- was surrendered to cover up any other deficiency found during the course of search and the assessment. The assessee duly included the aforesaid disclosure of income while filing its return of income on 29/11/2013 and paid the requ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /2015. 4. The Ld. AO levied penalty on the undisclosed income offered in the sum of Rs. 6,42,57,474/- with respect to specific income and of Rs. 3,98,235/- made in respect of addition u/s 69A of the Act. Accordingly, the penalty @10% amounting to Rs. 68,25,747/- was levied by the Ld. AO vide order u/s 271AAB of the Act on 29/03/2018. This action of the Ld. AO was upheld by the Ld. CIT(A). 5. Now, the short point that arises for our consideration is as to whether the preliminary show cause notice issued on 31/03/2015 for initiating penalty proceedings u/s 271AAB of the Act mentioning the inappropriate charge of offence committed by the assessee could be construed as defective notice or not. It is pertinent to note that that in the order pass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lty. (iii) 271AAB(1)(c)-60% of the undisclosed income would be the penalty (iv) 271AAB(1A)(a)- 30% of undisclosed income would be the penalty. (v) 271AAB (1A) (b)- 60% of the undisclosed income would be the penalty. 6. Further we find that the expression undisclosed income is also defined in Explanation-C to section 271AAB of the Act wherein it stipulates three conditions on which a particular income could be construed as an undisclosed income within the meaning of section 271AAB of the Act. For the sake of convenience, the show cause notice for initiating penalty proceedings on 31/03/2015 is reproduced hereunder: 7. For the sake of convenience, the definition of undisclosed income as defined in Explanation to section 271AAB of the Act is r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the Ld. AO becomes completely defective and consequentially fatal and would vitiate the entire penalty proceedings. This issue, in any case, is no longer res integra in view of the decision of Kolkata Tribunal in the case of Sushil Kumar Paul vs. ACIT in ITA No.2274/Kol/2019 for A.Y. 2016-17 dated 15/12/2022 wherein it was held as under:- 10. From going through the above notice issued to the assessee on 28/12/2017, we find that there is no mention about various conditions provided u/s 271AAB of the Act. The Id. AO has very casually used the proforma used for issuing notice before levying penalty u/s 271(1)(c) of the Act for the concealment of income or furnishing of inaccurate particulars of income. Except mentioning the section 271AAB ..... X X X X Extracts X X X X X X X X Extracts X X X X
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