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2022 (10) TMI 713 - AT - Income TaxPenalty u/s. 271(1)(c) - defective notice u/s 274 - disallowance of deduction u/s. 24 claimed by the Assessee @ 30% of the annual letable value of the rented property - Addition u/s. 40(ia) of the Act on account of non-deduction of tax at source on payments of 20,000 Euro made to a foreign entity for development of unique designs and patterns of various garments - HELD THAT:- The penalty provisions of section 271(1)(c) of the Act are attracted, where the Assessee has concealed the particulars of income or furnished inaccurate particulars of such income. It is also a well-accepted proposition that the aforesaid two limbs of section 271(1)(c) of the Act carry different meanings - it is imperative for the Assessing Officer to specify the relevant limb so as to make the Assessee aware as to what is the charge made against him so that he can respond accordingly. Having regard to the manner in which the Assessing Officer has issued the notices referred above under section 274 r.w.s. 271(1)(c) of the Act without specifying the limb under which the penalty proceeding has been initiated and proceeded with, apparently goes to prove that notice in this case has been issued in a stereotyped manner without applying mind which is bad in law, hence can not be considered valid notice sufficient to impose penalty u/s 271(1)(c) of the Act and therefore we are of the considered view that under these circumstances, the penalty is not leviable as held by the various Courts including the Hon’ble Apex Court and hence, we have no hesitation to delete the penalty under consideration, levied by the AO and affirmed by the Ld. Commissioner - Decided in favour of assessee.
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