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2020 (2) TMI 261 - AT - Income TaxPenalty u/s 271AAB(1)(c) - Defective notice - whether the notice issued u/s 274 r.w.s. 271AAB of the Act suffers from fatal error and technical defect thereby not providing an opportunity to the assessee to plead his case? - Admission of additional legal ground - HELD THAT:- In view of the ratio held by the Hon'ble Apex Court in the case of National Thermal Power Company Limited [1996 (12) TMI 7 - SUPREME COURT] admit the additional legal ground for adjudication. For levying penalty u/s 271AAB of the Act the Ld. A.O needs to primarily issue notice u/s 274 of the Act so for initiating proceedings u/s 271AAB of the Act the Ld. A.O has to first pass through the hurdle of Section 274. Three notices issued to the assessee on 22.03.2016, 03.06.2016 and 16.09.2016, we find that there is no mention about various conditions provided u/s 271 AAB - A.O has very casually used the proforma used for issuing notice before levying penalty u/s 271(1)(c) of the Act for the concealment of income or furnishing of inaccurate particulars of income. Except mentioning the Section 271AAB of the Act in the notice it does not talk anything about the provision of section 271AAB. Certainly such notice has a fatal error and technically is not a correct notice in the eyes of law because it intends to penalize an assessee without spelling about the charge against the assessee. We, therefore respectfully following the judgment of jurisdictional High Court in the case of PCIT V/s Kulwant Singh Bhatia [2018 (5) TMI 960 - MADHYA PRADESH HIGH COURT], decision of Co-ordinate Bench of Chennai in the case of DCIT V/s R. Elangovan [2018 (4) TMI 1553 - ITAT CHENNAI] and Jaipur Bench in the case of Ravi Mathur Vs DCIT [2018 (6) TMI 1128 - ITAT JAIPUR] and in the given facts and circumstances of the case wherein the matter written in the body of the notice issued u/s 274 of the Act does not refer to the charges of provision of Section 271AAB of the Act makes the alleged notice defective and invalid and thus deserves to be quashed. Since the penalty proceedings itself has been quashed the impugned penalty stands deleted. Thus assessee succeeds on legal ground challenging the validity of notice issued u/s 274 r.w.s. 271AAB of the Act.
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