Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2019 (7) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (7) TMI 289 - AT - Income TaxPenalty u/s 271(1)(c) - disallowance of expenses which was not capitalized to plant and machinery - recording of satisfaction - notice is either for furnishing of inaccurate particulars of income or for concealment of income - HELD THAT:- It is a settled law that while levying penalty for concealment, the AO has to record satisfaction and thereafter come to a finding in respect of one of the limbs, which is specified u/s 271(1)(c). The first step is to record satisfaction while completing the assessment as to whether the assessee had concealed its income or furnished inaccurate particulars of income. Thereafter, notice u/s 274 r.w.s 271(1)(c) is to be issued to the assessee. The AO thereafter has to levy penalty u/s 271(1)(c) for non-satisfaction of either of the limbs. While completing the assessment, the AO has to come to a finding as to whether the assessee has concealed its income or furnished inaccurate particulars of income. The Hon’ble Bombay High Court in CIT Vs. Shri Samson Perinchery [2017 (1) TMI 1292 - BOMBAY HIGH COURT] has held that where initiation of penalty is one limb and the levy of penalty is on other limb, then in the absence of proper show cause notice to the assessee, there is no merit in levy of penalty. In the present case, as noted hereinabove, it is seen that the AO has not recorded any satisfaction in the assessment order but had levied penalty for “furnishing of inaccurate particulars of income” as well as for “concealment of income” i.e., for both the limbs. - appeal of the assessee is allowed
|