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2022 (4) TMI 845 - AT - Income TaxPenalty u/s 271(1)(c) - Defective notice u/s 274 - assessee claim for deduction of expenses under Section 57 - HELD THAT:- The full Bench of the Hon”ble Bombay High Court in the case Mohd. Farhan A Shaikh [2021 (3) TMI 608 - BOMBAY HIGH COURT] has held that a mere defect in the notice - not striking off the irrelevant matter, would vitiate the penalty proceedings. A perusal of the penalty notice, dated 26.12.2016, issued under Section 274 read with 271 of the Act would show that it in an omnibus show cause notice issued without deleting or striking off the inapplicable part. Similarly, the Assessment Order, dated 26.12.2016, is also vague as it states that “Penalty proceedings u/s 271(1)(c) of the I.T. Act, 1961 are initiated separately for concealing and furnishing inaccurate particulars of income. Same is the case with the penalty order, dated 23.06.2017, passed under Section 271(1)(c) of the Act, as it also does not state under which limb of Section 271(1)(c) of the Act penalty has been levied. Thus the penalty proceedings stand vitiated on account of defect in the penalty notice - Decided in favour of assessee.
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