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TMI Blog2024 (5) TMI 1393X X X X Extracts X X X X X X X X Extracts X X X X ..... ax Act, 1961 and hence the infirmity, if any, in these are taken care of by the provisions of Section 292B of the Income Tax Act, 1961. 3. The appellant craves leave for reserving the right to amend, modify, alter, add or forego any ground(s) of appeal at any time before or during the hearing of this appeal." 2. Briefly stated facts are that for A.Y. 1998-99 original return of income was filed on 30.11.1998 declaring loss of Rs. 12,41,10,146/-. Assessment u/s 143(3) of the Income-tax Act, 1961 (hereinafter referred to as the "Act") was framed on 21.03.2001 at a total income of Rs. 27,76,640/-. The said order stood set aside vide order dated 26/27.03.2015 of the learned PCIT passed u/s 264 of the Act. Accordingly, In fresh assessment order 08.03.2016, u/s 143(3) read with section 264 of the Act, the AO assessed the assessee's income at a loss of Rs. 5,05,35,194/-. In doing so the AO rejected the books of account u/s 145 of the Act and against gross loss of Rs. 6,21,67,943/-, gross profit was estimated at 10.73% on the turnover of Rs. 10,63,09,501/- and on the basis of estimation of profit an addition of Rs. 1,14,07,009/- was made. The assessee did not file any appeal against the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ticulars of the income. This clearly indicates that the entire exercise of initiation of penalty proceedings has been done in a casual and cavalier manner. 4. It is a settled provision of law that notice issued by AO under Section 274 read with Section 271(1)(c) is bad in law if it did not specify which limb of Section 271(1)(c) of the Act is attracted and thus the penalty proceedings are liable to be quashed. Reliance is placed on the following judicial pronouncements in this regard: - COMMISSIONER OF INCOME TAX & ANR. VERSUS M/S SSA'S EMERALD MEADOWS, 2016 (8) TMI 1145-SC ORDER, Dated: 5-8-2016 - PR. COMMISSIONER OF INCOME TAX, AND OTHERS VERSUS M/S. SAHARA INDIA LIFE INSURANCE COMPANY, LTD., 2019 (8) TMI 409- DELHI HIGH COURT, Dated: -2- 8-2019 - PRINCIPAL CIT, CENTRAL 2, KOLKATA VERSUS BRIJENDRA KUMAR PODDAR, 2021 (12) TMI 24-CALCUTTA HIGH COURT, Dated: 23-11- 2021 - COMMISSIONER OF INCOME TAX, BANGALORE AND THE INCOME TAX OFFICER, WARD-6 (3), BANGALORE VERSUS M/S SSA'S EMERALD MEADOWS, 2015 (11) TMI 1620-KARNATAKA HIGH COURT, Dated: 23-11-2015 5. Moreover, in the present case, the limb of Section 271(1)(c) has neither been specified in the quantum assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cknowledged the fact that the addition had been made on the basis of estimation and there is no other material to prove that the assessee has concealed any income or furnished any inaccurate particulars of its income. The relevant finding is at Pg. 10 of the CIT(A) Order which is also reproduced hereunder: "I have considered the submission of the appellant and observation of the Assessing Officer in the penalty order. It is seen that penalty has been levied in the case of the appellant on the basis of disallowance of loss and estimation of the profit on the turnover declared by the appellant. The AO has disallowed loss and estimated profit due to the fact that appellant could not produce books of accounts before the AO at the time of assessment made u/s 143(3) read with section 264 of the Act as the appellant did not received the books of accounts from the Official Liquidator on revival of the Company. However, the fact of the matter is that there is no information on record that appellant has concealed any income or furnished inaccurate particulars of its income. The estimation has been made simply on the basis of non-production of books of accounts. There is no information that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 27-4-2023 7. In view of the above-mentioned facts and circumstances of the case and the case laws relied upon by the assessse, the penalty amounting to Rs. 2,57,51,233/- levied by the AO u/s 271(1)(c) has been rightly deleted by CIT(A)." 5. We have heard rival submissions and perused the material available on record. The impugned notice dated 08.03.2020 issued by the AO, reads as under:- "Office of the Income tax Officer, Ward 3(3), Room No 398, C.R. Building, New Delhi. NOTICE UNDER SECTION 274 READ WITH SECTION 271 OF THE INCOME TAX 271(1)(c) Dated: 08.03.20 To The Principal Officer, M/s Asian Consolidated Industries Ltd. 96th Mile Stone, District-Bawal, Rewari, Jaipur Highway, Haryana In the course of proceedings before the AO for the assessment year 1998- 1999 it appears to me that you:- *have concealed the particulars of your income or furnished inaccurate particulars of such income in terms of explanation 1,2,3,4 and 5. You are hereby requested to appear before me at 11:00 A.M. on 04.04.2016 and show cause why a order imposing a penalty on you should not be made under section 271(1)(c) of the Income Tax Act, 1961. If you do not wish to avail yoursel ..... X X X X Extracts X X X X X X X X Extracts X X X X
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