TMI BlogNotice must be correct, complete and unambigous to enable noticee to respond to it properly, otherwise opprotunity to respond properly is not allowed and notice and consequent proceeding and orders can be held void.X X X X Extracts X X X X X X X X Extracts X X X X ..... Notice must be correct, complete and unambigous to enable noticee to respond to it properly, otherwise opprotunity to respond properly is not allowed and notice and consequent proceeding and orders can be held void. - By: - DEV KUMAR KOTHARI - Other Topics - Dated:- 19-12-2023 - Notice must be correct, complete and unambigous to enable noticee to respond to it properly, otherwise oppertunity to respond properly is not allowed and notice and consequent proceeding and orders can be held void. The title of the article: The title of article has been framed in a broader sense to apply fundamental rule in relation to any proceeding and not only in relation to penalty proceedings. Purpose of notice: Purpose of notice is not only to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... comply with requirement to issue a notice but to provide the noticee ( to whom notice is issued) an enabling material in writing to understand what for notice is issued and what noticee is supposed to do. Therefore, any notice must be correct, complete and unambigous to enable noticee to respond to it properly, otherwise opprotunity to respond properly is not allowed , noticee is not sure as to what for the notice is issued and he is unable to repond properly. In that circumstnce notice and consequent proceeding and orders can be held void. Recent order of the Supreme Court in relation to penalty under section 271.1.c: PR. COMMISSIONER OF INCOME TAX - 5 VERSUS KOLKATA PORT TRUST - 2023 (11) TMI 292 - SC ORDER Read ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with corresponding order and judgment of honorable Calcutta High Court and Kolkata ITAT reported as : 1. PRINCIPAL COMMISSIONER OF INCOME TAX 5, KOLKATA VERSUS KOLKATA PORT TRUST - 2022 (10) TMI 987 - CALCUTTA HIGH COURT and 2. DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE-35, KOLKATA. VERSUS KOLKATA PORT TRUST AND (VICE-VERSA) - 2020 (2) TMI 1045 - ITAT KOLKATA The proceedings, matter and dispute relates to penalty u/s 271(1)(c) and concerns concept of defective notice u/s 274 in which not applicable portion was not strik off. From Judgment / Order HON'BLE MRS. JUSTICE B. V. NAGARATHNA And HON'BLE MR. JUSTICE UJJAL BHUYAN For the Petitioner : Mr. Raj Bahadur Yadav, AOR Mr. Balbir Singh, A.S.G. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mr. Rupender Singhmar, Adv. Mr. Naman Tondon, Adv. Mrs. Sunita Sharma, Adv. Mr. Navanjay Mahapatra, Adv. ORDER UPON hearing the counsel the Court made the following: Delay in filing the special leave petition is condoned. We are not inclined to interfere in the impugned judgment and order of the High Court. The special leave petition is dismissed. Pending application(s), if any, shall also stand disposed of. Observations of author : The judgment is passed by Division Bench of Honorable Supreme Court having quorum of two judges. The petitioner Pr. CIT (on behalf of UO)I, was represented by five Counsels. The order has been passed after hearing counsel. There was delay in filing of the Special Leave ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petition, (SLP). Hearing took palce on Condonation petition and SLP both. It is only after the hearing counsel of Petitioner that honorable Court passed the order holding that We are not inclined to interfere in the impugned judgment and order of the High Court . The honorable Supreme Court has not mentioned that question of law is left open. Therefore, it is clear case that the honorable Supreme Court has affirmed the view taken by the High Court and the Tribunal. Earlier orders of Honorable Supreme Court not cited: It is unfortunate that the Revenue has idulged into litigation although the matter was decided in favor of assessee by dismissal of similar SLP of revenue, in several cases. To mention a few: COMMI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SSIONER OF INCOME TAX ANR. VERSUS M/S SSA'S EMERALD MEADOWS - 2016 (8) TMI 1145 - SC ORDER PR. COMMISSIONER OF INCOME TAX (CENTRAL) VERSUS M/S. GOLDEN PEACE HOTELS AND RESORTS PVT. LTD. - 2021 (3) TMI 195 - SC ORDER From judgment of Calcutta High Court (with highlights added by author for analysis): The revenue has raised the following substantial questions of law for consideration :- a) Whether on the facts and in the circumstances of the case and in law, the Learned Income Tax Appellate Tribunal erred in mechanically holding the notice for imposition of penalty as invalid, because of not striking off the inaccurate particular of income portion in the notice under section 274 of the Income Tax Act, 1961 for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... initiation of penalty proceeding U/s. 271(1)(c) ? b) Whether on the facts and in the circumstances of the case and in law, the Learned Income Tax Appellate Tribunal erred in quashing the penalty order under section 271(1)(c) of the Income Tax Act, 1961 , only because of not striking off the inaccurate particular of income portion in the notice under section 274 even when no prejudice has been caused to the assessee ? Observations of author on Questions of law: I seems that revenue and its officers and counsels have considerd the event of issue of notice as a simple formality without considering its factual and legal importance. For any proceeding to be effective it is essential that it must be properly initiated by pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oper and adequate communication to the noticee, to enable him to respond to the notice. The revenue has challenged order of Tribunal and mechanically holding and only because of ot striking off ... . They have ignored that what they have done by not issuing proper and complete notice. From order of High Court- with highlights: The short issue involved in the instant case is whether penalty imposed by the assessing officer under Section 271(1)(c) of the Act was sustainable in law. The Commissioner of Income Tax (Appeals) 10, Kolkata [CIT(A)] vide order dated 28th December, 2017 set aside the penalty. On perusal of the order we find that the CIT(A) rightly took note of the legal position that merely because of an addition s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tands confirmed penalty under Section 271(1)(c) is not automatic. The CIT(A) examined the fact of the case and after taking note of the decision of the Supreme Court in PRICE WATERHOUSE COOPERS (P.) LTD. VERSUS COMMISSIONER OF INCOME-TAX, KOLKATA - I - 2012 (9) TMI 775 - SUPREME COURT . On facts it is found that the assessee s aim to offer interest income on income tax refund was an inadvertent and bona fide error and no contumacious conduct has been established by the assessing officer. The revenue filed appeal before the Tribunal. The Tribunal after considering the correctness of the order passed by the CIT also found that notice issued by the assessing officer under Section 271(1)(c) of the Act was defective , inasmuch as the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rrelevant portion of the notice has not been struck off. Therefore, the assessee did not have adequate opportunity to put forward their submission in response to the penalty notice . The learned Senior Counsel had referred to the decision of this Court in the case of PRINCIPAL CIT, CENTRAL 2, KOLKATA VERSUS BRIJENDRA KUMAR PODDAR - 2021 (12) TMI 24 - CALCUTTA HIGH COURT where the Court took into consideration the decision in the case of COMMISSIONER OF INCOME TAX AND ANOTHER VERSUS MANJUNATHA COTTON AND GINNING FACTORY, MANJUNATH GINNING AND PRESSING, VEERABHADRAPPA SANGAPPA AND CO., V.S. LAD AND SONS, G.M. EXPORT - 2013 (7) TMI 620 - KARNATAKA HIGH COURT and dismissed the appeal filed by the revenue. Thus we find that the cor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rect legal position has not been noted by the CIT but the learned Tribunal as well. Thus we find there is no substantial question arising for consideration in this appeal. For such reason, the appeal fails and dismissed. Observations of author: The honorable Tribunal and High Court has considered the issue in totality and found that merely because an addition was confirmed does not mean that there was furnishing of inaccurate particulars of income or concealment of income. The rulings of the Supreme Court and some of high Courts were referred, relied and applied. Therefore it is a case of un-necessary litigation by revenue on settled legal position on many directly similar and related issues. It was a fit case where ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... honorable Supreme Court / and High Court both could impose penalty on all concerned who have caused loss of valuable time of High Court, Supreme Court and loss of public money by indulging into un-necessary litigation. Applicability of underlying rule in relation to other notices: Though the matter involved was related to penalty u.s. 271.1.c, but the law and rule about notice is applicable in other situations also. If a notice is not complete, is vague, is not specific then the notice and consequential proceedings and orders can be void. - Scholarly articles for knowledge sharing authors experts professionals Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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