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2019 (10) TMI 511 - ITAT JAIPURPenalty u/s 271(1)(c) - defective notice - HELD THAT: - As decided in SHRI H. LAKSHMINARAYANA [2015 (7) TMI 601 - ITAT BANGALORE] show cause notice was defective as it did not spell out specifically the ground on which the penalty was sought to be imposed. The ITAT Bangalore Bench further held that such defect was not curable u/s 292BB. In view of these facts, the penalty in the case of the assessee also deserves to be deleted. Thus considering the judgement as cited by the assessee (supra), we are of the view that notices issued by the Revenue authorities were not legally and lawfully perfect. The levy of penalty on the basis of such notices is unlawful, illegal and unjustified. Taking into consideration all these facts, circumstances of the case and the case laws relied upon (supra), we allow these grounds of the assessee and delete the penalty levied by the AO and upheld by the ld. CIT(A). Thus Ground No. 1 and 2 of the assessee are allowed. Addition u/s 68 - HELD THAT:- Since in the present case the AO in the penalty proceedings had not examined the entire issue afresh and even otherwise the identity of the creditor and genuineness of the transaction has not been found fault with, therefore, we are of the view that the explanations and the documents relied upon by the assessee to prove the creditworthiness were only found to be inadequate and not found to be false. Under the set of facts, we are of the view that the Explanation to Section 271(1)(c) of the Act would come to help of the assessee. Hence on conspectus of the matter, we are of the view that the addition of cash credit confirmed by the ITAT in the facts and circumstances of the instant case, would not necessitate levy of penalty u/s 271(1)(c) of the Act, as the same in our view cannot be considered to be concealment of income. Accordingly, we set aside the order of the ld. CIT(A) on this issue and direct the AO to delete the penalty. - Decided in favour of assessee.
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