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2021 (5) TMI 687 - AT - Income TaxPenalty u/s 271(1)(c) - defective notice u/s 274 - AO did not strike off either of the two limbs viz., concealed the particulars of income or furnished inaccurate particulars of such income, albeit it was a case of furnishing of inaccurate particulars of income - HELD THAT:- A copy of the notice issued u/s. 274 of the Act has been placed in the appeal folder, from which it is discernible that the AO did not strike off either of the two limbs viz., concealed the particulars of income or furnished inaccurate particulars of such income, albeit it was a case of furnishing of inaccurate particulars of income. The penalty order also came to be passed by holding in para 6.5 that: 'the amount added or disallowed in computing the total income of the assessee as a result thereof shall, for the purposes of clause (c) of this sub- section (1) of section 271, be deemed to represent the income in respect of which particulars have been concealed or inaccurate particulars have been furnished.' It is clear that where the charge is not properly set out in the notice u/s. 274 viz., both the limbs stand therein without striking off of the inapplicable limb, but the penalty has been, in fact, levied for one of the two, such a penalty order gets vitiated. We find from the notice u/s. 274 of the Act that the AO did not strike out one of the two limbs. Not only that, the penalty was also imposed in the same way by referring to both the limbs in the penalty order. As against that, the penalty was leviable only on one limb, namely, furnishing of inaccurate particulars of income. In such a situation, the penalty order gets vitiated. Respectfully following MR. MOHD. FARHAN A. SHAIKH [2021 (3) TMI 608 - BOMBAY HIGH COURT] we overturn the impugned order and direct to delete the penalty. - Decided in favour of assessee.
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