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TMI Blog2016 (2) TMI 1130X X X X Extracts X X X X X X X X Extracts X X X X ..... , he assails the levy of penalty levied u/s.271(1)(c) of the Income-tax Act, 1961 ( the Act in short). 02. One of the grounds taken by the assessee states that the notice issued initiating the penalty proceedings suffer from incurable defect. In support of this, assessee has filed a copy of the notice dt. 16.12.2011, issued u/s.274 r.w.s.271 (1)(c) of the Act. 03. Per contra, Ld. DR submitted that assessee had not raised any ground before the CIT (A) assailing the validity of the notice issued u/s.274 r.w.s.271 of the Act. As per the Ld. DR, levy of penalty for the impugned assessment year was for concealment of income. Ld. DR submitted that even in a revised return filed by the assessee, assessee had failed to disclose the correct i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n our opinion, notice has to specify whether there was concealment of particulars of income or furnishing of inaccurate particulars of income. If there are both, it is the duty of the AO to specify so. Hon ble jurisdictional High Court in the case of CIT v. M/s. Manjunatha Cotton Ginning Factory (359 ITR 565) held as under at paras 15 to 17 : 15. The first legal question is whether the notice u/s 274 r.w.s.271 is valid. The learned DR s objection is that the assessee has not raised any specific ground of appeal on this issue. However, we find in the ground of appeal no.2, the assesssee has raised an objection that the order of penalty passed by the ld.AO u/s271(1) of the IT Act, is without jurisdiction as the mandatory condition for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oncealment of particulars of income or furnishing of inaccurate particulars of income. The Hon ble High Court has held that both the conditions are different and distinct though at times they may overlap with each other. It was held that AO while issuing notice u/s 274 has to come to the conclusion as to whether it is case of concealment of income or it is a case of furnishing of inaccurate particulars of income and if the standard proforma without deleting the relevant clause is issued, it leads to an inference as to non-application of mind by the AO. The relevant portion of the Honble High Court s order is reproduced hereunder: 59. As the provision stands, the penalty proceedings can be initiated on various grounds set out therein. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ifically. Otherwise, principles of natural justice is offended/f the shown cause notice is vogue. On the basis of such proceedings no penalty could be imposed on the assessee. 60. Clause (c) deals with two specific offences, that is to say, concealing particulars of income or furnishing inaccurate particulars of income. No doubt, the facts f the some cases may attract both the offences and is some cases there may be overlapping of the two offences but in such cases the initiation of the penalty proceedings also must be for both the offences. But drawing up penalty proceedings for one offence and finding the assessee guilty of another offence of finding him guilty for either the one or the other cannot be sustained in law. It is needle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Act to initiate penalty proceedings once he is satisfied in the cause of any proceedings that there is concealment of income or furnishing of inaccurate particulars of total income under clause(c). Concealment, furnishing inaccurate particulars of income are difference. Thus, the A 0 while issuing notice has to come to the conclusion that whether is it a case of concealment of income or is it a case of furnishing of inaccurate particulars. The Apex Court in the case of Ashok Pai reported in 292 ITR 11 at pages 19 has held that concealment of income and furnishing inaccurate particulars of income carry different connotations. The Gujarat Court in the case of Manu Engineering reported in 122 ITR 306 and the be Delhi High Court in the case o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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