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2020 (8) TMI 814 - AT - Income TaxPenalty u/s 271(1)(c) - defective notice - Capital gain computation - addition by invoking the provisions of section 50C - HELD THAT:- We find, the AO, in the instant case, made addition u/s 50C on account of difference between the stamp duty value and actual sales consideration received by the assessee on the sale of the property. A perusal of the notice issued u/s 274 r.w. section 271(1)(c), shows that the inappropriate words in the said notice has not been struck off and the said notice does not specify the limb under which the penalty was levied. Similar view has been taken in various other decisions relied on by the ld. Counsel placed in the paper book. Since the inappropriate words in the notice has not been struck off, therefore, following the decision of the Hon’ble Karnataka High Court in the case of Manjunatha Cotton and Ginning Factory [2013 (7) TMI 620 - KARNATAKA HIGH COURT] and SSA's Emerald Meadows [2015 (11) TMI 1620 - KARNATAKA HIGH COURT] where the SLP filed by the Revenue has been dismissed, we hold that the penalty proceedings initiated by the AO are not in accordance with the law and, therefore, has to be quashed. We accordingly quash the penalty proceedings and direct the AO to cancel the penalty. Since the assessee succeeds on this legal ground, the grounds challenging the penalty on merit are not being adjudicated. Medical expenses on director disallowed - AO noted that the assessee should have entered the perquisite in the hands of Shri Raman Kumra, the non-executive director which was not done in the instant case - HELD THAT:- CIT(A), in the instant case, has passed an ex parte order due to nonappearance of the assessee. A perusal of the paper book page 50 shows that the assessee has filed an adjournment application before the CIT(A) on 24th August, 2016 seeking adjournment of the case to 2nd September, 2016. However, the same was rejected by the CIT(A) and he passed the order on 26th August, 2016. Considering the totality of the facts of the case and in the interest of justice, we deem it proper to restore the issue to the file of the CIT(A) with a direction to grant one more opportunity to the assessee to substantiate its case and decide the issue as per fact and law.
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