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2018 (6) TMI 1743 - ITAT JAIPURRevision u/s 263 - Levy of penalty u/s 271AAB - Non specification of sub clause of the provisions of Section 271AAB under which penalty imposed - HELD THAT:- AO initiated the penalty proceedings U/s 271AAB by issuing notice U/s 274 read with Section 271 of the I.T. Act, 1961 on 13/03/2015 wherein the penalty has been initiated “on assessed undisclosed income” as evident from copy of notice scanned at page No. 9 of this order. The Assessing Officer has not specified under which sub clause of Section the notice has been issued. Thus, it is clear from records that the assessee has not been sufficiently noticed about the sub clause of the provisions of Section 271AAB. A.O. has not specified the sub clause in notice. In such a factual situation, in our considered view, the ratio laid down by the Hon'ble Supreme Court in the case of Malabar Industrial Co. Ltd. v. CIT [2000 (2) TMI 10 - SUPREME COURT] that an incorrect assumption of fact or an incorrect application of law will satisfy the requirement of the order being erroneous, shall not be applicable in this case. In absence of a clear cut finding of ld. Pr.CIT on the basis of documents found and seized and statements recorded during the search, the Pr.CIT. was not justified in issuing such direction. The Pr.CIT cannot reach at a conclusion that the provisions of Section 271AAB (1)(c) are applicable in assessee’s case without clear and final finding on this issue. We would also like to hold that once the assessee has preferred the appeal against the order of Assessing Officer for levy of penalty u/s 271AAB of the Act, there is no scope for the ld. Pr.CIT to invoke the provisions of Section 263 of the Act to cover any legal lacuna. Moreover, in a situation where the assessee has been granted certificate under the Direct Tax Dispute Resolution Scheme, 2016 which continues to be valid then also provisions of Section 263 could not be invoked. We would also like to mention that once the certificate issued under DRS Scheme is withdrawn in future then the appeal of assessee before CIT(A) shall revive. In such a situation also the Pr.CIT shall not have jurisdiction to invoke provisions of Section 263 of the Act. There is no scope for treating the penalty order passed by the Assessing Officer as erroneous and prejudicial to the interest of revenue. Accordingly, the order U/s 263 of the Act passed by the ld. Pr.CIT is hereby quashed.
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