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2022 (7) TMI 329 - ITAT DELHIPenalty u/s 271(1)(c) - additions for provision for liquidated damages charges and interest on TDS - HELD THAT:- As quantum appeal in regard to the addition made by the ld AO on account of provision of liquidated damages stands deleted and once the quantum appeal is allowed no foundation is left for the levy of penalty on that account. See Fortune Technocomps P.Ltd. [2016 (5) TMI 859 - DELHI HIGH COURT] where it has held that once the assessment order of the AO in the quantum proceedings was altered by the Ld.CIT(A), in a significant way, the very basis of initiation of penalty proceedings was nonexistent. Interest on TDS - AO in his assessment order had not mentioned a word regarding his satisfaction for proceeding with penalty proceedings u/s 271(1)(c) of the Act while passing the impugned penalty order dated 23.03.2018. The assessment order does not mention if penalty proceedings has to be for concealment of particulars of income or for furnishing inaccurate particulars of income. As a matter of fact the notice issued u/s 274 read with section 271 of the Act itself was ambiguous as it did not make it clear as to under which limb section of 271(1)(c) of the Act the notice was issued. On the other hand in the penalty order the ld AO has coined her own term “concealed income by furnishing inaccurate particulars.” Thus ambiguity in issue of notice and findings make the impugned order of levying penalty void ab initio and ld CIT(A)failed to consider the same. Appeal of assessee allowed.
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