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2019 (9) TMI 1650 - AT - Income TaxPenalty u/s 271(1)(c) - Defective notice u/s 274 - non striking or irrelevant portions - as argued at the time of levy of the penalty the order u/s 271(1)(c) clearly show that the “assessee has furnished inaccurate particulars of income‟ in the first para of the penalty order and in the 3rd para of penalty order it is stated that the “assessee has concealed the particulars of income - HELD THAT:- In the show cause notice issued by the learned assessing officer u/s 274 read with section 271 (1) (c) none of the twin charges for initiating the penalty proceedings were struck off. Further, in the assessment order the penalty is initiated in the last para of the assessment order stating that the assessee has concealed the particulars of income and also submitted inaccurate particulars of its income. In the penalty order also at various paragraphs there is inconsistency with respect to the nature of default committed by the assessee. In paragraph number 1 the AO stated that assessee has furnished inaccurate particulars of his income. In paragraph number 3 AO states that assessee has concealed the particulars of income. In paragraph number 4 the AO states that the penalty is initiated for furnishing inaccurate particulars of income. We are of the considered view that when the notice issued by the AO is bad in law being vague and ambiguous having not specified under which limb of section 271(1)(c) of the Act, the penalty proceedings initiated u/s 271(1)(c) are not sustainable. Even the AO has failed to apply his mind at the time of recording satisfaction at the time of framing assessment to initiate the penalty proceedings u/s 271(1)(c) of the Act as to under which limb of section 271(1)(c) i.e. for concealing particulars of income or furnishing inaccurate particulars of such income, penalty proceedings have been initiated rather written vague and ambiguous satisfaction recorded throughout the assessment order as well as penalty orders. - Decided in favour of assessee.
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