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2016 (9) TMI 1345 - AT - Income TaxPenalty u/s 271(1)(c) - addition u/s 56(2)(vii)(b) for gift received from nephew - defective notice - Held that:- Notice has been issued by ticking the stereotyped format. This fact is not controverted by the revenue. Therefore, in our considered view, penalty proceeding is not validly initiated. Hence the initiation of penalty on the basis of the notice dated 13th March, 2013 is not in accordance with the requirement of law. We find that assessee has disclosed the factum of gift. However, claimed exemption under section 50(2)(vii)( b) was found to be not available to the assessee. We have given a thoughtful consideration to the judgment of Hon’ble Supreme Court in the case of Reliance Petroproducts Pvt. Ltd.(2010 (3) TMI 80 - SUPREME COURT) wherein held merely a claim which was made bonafide in respect of exemption or deduction is rejected or not only on the basis of levy of penalty, the AO is required to give the clear finding that the claim of exemption as made was with an intention to evade tax. - Decided in favour of assessee.
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