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TMI Blog2024 (12) TMI 105X X X X Extracts X X X X X X X X Extracts X X X X ..... has clearly stated that the assessee agreed to offer the income only to buy peace and avoid protracted litigation. As we have already discussed in deciding the issue placed in the additional ground, we find that penalty order u/s 271(1)(c) of the Act having been initiated by the Ld. AO on one ground i.e. concealment. However, Ld. CIT(A) has initiated on the other ground i.e. inaccurate particulars of income that goes to prove that the penalty proceeding is without jurisdiction and bad in law. The penalty u/s 271(1)(c) of the Act is hereby directed to be deleted. Assessee appeal allowed. - Sri Rajesh Kumar, Accountant Member And Pradip Kumar Choubey, Judicial Member For the Assessee : S. K. Tulsiyan, Adv. For the Department : Ranu Biswas, ADDL.CIT, Sr. DR. ORDER PER PRADIP KUMAR CHOUBEY, JUDICIAL MEMBER: This appeal filed by the assessee pertaining to the Assessment Year (in short AY ) 2012-13 is directed against the order passed u/s 250 of the Income Tax Act, 1961 (in short the Act ) by ld. Commissioner of Income-tax (Appeals)-NFAC, Delhi [in short ld. CIT(A) ] dated 18.06.2024 arising out of the assessment order framed u/s 144/147 of the Act dated 22.11.2019. 1.1. The brief fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... articulars of income and (ii) an assessee has furnished inaccurate particulars of income. The ld. Counsel for the assessee further submits that penalty u/s 271(1)(c) of the Act speaks further that it is leviable if the Ld. AO is satisfied in the course of any proceeding under this Act that any person has concealed the particulars of income or furnished inaccurate particulars of income. Ld. Counsel for the assessee further submits that there has to be satisfaction of the Assessing Officer (hereinafter referred to as ld. 'AO') initiating the penalty as is to be clearly noted in a notice issued u/s 271(1)(c) of the Act as to which charge the said penalty been sought to be imposed which is completely lacking in this case. The ld. Counsel for the assessee further submits that Ld. CIT(A) in its appellate proceeding also passed that there is a reason of furnishing inaccurate particulars of income and penalty order u/s 271(1)(c) of the Act passed by the Ld. AO reveals that for concealment of particulars of income that is contrary to each. Ld. Counsel for the assessee cited following decision on this point: 1. CIT Vs. SSA'S Emerald Meadows reported in [2016] 73 taxmann.com 248 ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for determination of this appeal are whether the penalty order passed by the Ld. AO confirmed by the Ld. CIT(A) is justified and legal. 2.1. The submission of the ld. Counsel for the assessee is that proceeding u/s 271(1)(c) of the Act can only be invoked either the assessee has concealed the particulars of his income or the assessee has furnished inaccurate particulars of his income. In the present case while we go over the order of the Ld. AO-, it appears to us that penalty notice u/s 274 r.w.s. 271(1)(c) of the Act dated 31.12.2019 was issued for initiating the same for concealment of particulars of income though the penalty order u/s 271(1)(c) of the Act was passed on 15.09.2021. However, Ld. CIT(A) in appellate proceeding against the said penalty order passed his appellate order on 18.06.2024 for the reason furnishing inaccurate particulars of income. It is clear that Ld. CIT(A) did not commence fresh penalty notice under the limb of furnishing inaccurate particulars of income by issuing fresh show cause notice. 2.2. Now looking at the judgment cited by the assessee in this context and we find that in case of CIT Anr. Vs. Manjunatha Cotton and Ginning Factory (359 ITR 565) (Ka ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e offence and finding the assessee guilty of another offence or finding him guilty for either the one or the other cannot be sustained in law. It is needless to point out satisfaction of the existence of the grounds mentioned in Section 271(l)(c) when it is a sine qua non for initiation or proceedings, the penalty proceedings should be confined only to those grounds and the said grounds have to be specifically stated so that the assessee would have the opportunity to meet those grounds. After, he places his version and tries to substantiate his claim, if at all, penalty is to be imposed, it should be imposed only on the grounds on which he is called upon to answer. It is not open to the authority, at the time of imposing penalty to impose penalty on the grounds other than what assessee was called upon to meet. Otherwise though the initiation of penalty proceedings may be valid and legal, the final order imposing penalty would offend principles of natural justice and cannot be sustained. Thus once the proceedings are initiated on one ground, the penalty should also be imposed on the same ground. Where the basis of the initiation of penalty proceedings is not identical with the groun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her ground i.e. inaccurate particulars of income that goes to prove that the penalty proceeding is without jurisdiction and bad in law. We have also gone through the judgment filed by the assessee passed in the case of S Badri vs ITO by ITAT, Chandigarh in which it has been held: Again, at this juncture, attention is invited to a recent decision of the Chennai ITAT in the case of 5. Badri vs. The Income Tax Officer, I.T.A. No. 2607/Mds/2014 pronounced on 24 May, 2016 (Copy enclosed) The brief facts of this case was that the assessee is a Senior Citizen and filed her return of income for the assessment year 2009-2010 admitting total income of Rs. 7,42,540/- and same was processed u/s. 143(1) of the Act. The case was selected for scrutiny and notice u/s. 143 (2) of the act was issued. In compliance to above notice, the Id. Authorised Representative of assessee appeared and filed details for verification. The Id. Assessing Officer alleged that as per the Annual Information Report (AIR) the assessee has made cash deposits aggregating to Rs. 45,01,000/- with The Lakshmi Vilas Bank Ltd, R.S.Puram branch, Coimbatore and was asked to file explanations in the assessment proceedings. The Ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry circumstance has to be weighed with genuinely and bonafides. Considering the apparent facts, submissions on record, the findings of the lower authorities are entirely one way as the assessee has accepted the income after receipt of notice u/s. 143(2) of the Act. But the Id. Assessing Officer relied only on AIR information and no independent investigation was considered before completion of assessments. The assessee has not contested disputed issue in the assessment proceedings. Considering the Senior Citizen age of the assessee and assessee died during the income tax proceedings and the legal heir was brought on record. The genuine facts that the assessee has paid the taxes before the completion of assessment proceedings and not contested the assessment. Prime facie penalty proceedings are not automatic and every addition cannot contested for levying the penalty and we draw support from the principles laid down in case of case of CIT vs. Manjunatha Cotton and Ginning Factory, 359 ITR 565, (Karnataka) were it was held that the penalty proceedings are not automatic and they are distinct. Considering the factual matrix, legal decisions and assessment records, we set aside the order ..... X X X X Extracts X X X X X X X X Extracts X X X X
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