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2018 (6) TMI 961 - AT - Income TaxInitiation of penalty u/s 271(1)(c) - disallowance of long-term capital loss - barred by limitation u/s 275 - additional evidences - Held that:- As per section 275(1)(a) AO was obligated to levy the penalty within one year from the end of the financial year in which order dated 26.10.2012 passed by ld. CIT (A) was received. More so, in case of penalty on account of disallowance of long term capital loss, no appeal was filed by the assessee before the Tribunal and in that case, limitation expired on March 31, 2014. In these circumstances, penalty order passed by the AO on 30.01.2015 is passed beyond the prescribed period of limitation. Validity of notice u/s 271(1)(c) - no proper notice has been issued to the assessee u/s 274 - Held that:- As per the notice issued u/s 274 AO himself was not aware as to whether he is issuing notice to initiate the penalty proceedings either for “concealment of particulars of income” or “furnishing of inaccurate particulars of such income” by the assessee rather issued vague and ambiguous notice by incorporating both the limbs of section 271(1)(c). When the charge is to be framed against any person so as to move the penal provisions against him, he/she should be specifically made aware of the charges to be leveled against him/her - reliance is placed on decision in case of CIT vs. Manjunath Cotton and Ginning Factory [2013 (7) TMI 620 - KARNATAKA HIGH COURT] where it is said that when the AO has failed to issue a specific show-cause notice to the assessee as required u/s 274 read with section 271(1)(c), penalty levied is not sustainable - thus in the present case AO has miserably failed to specify in the notice issued u/s 274 r.w.s. 271(1)(c) “as to whether the assessee has concealed the particulars of his income or has furnished inaccurate particulars of such income”, so in these circumstances, penalty levied by the AO and confirmed by ld. CIT (A) is not sustainable - Decided in favor of assessee.
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