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2020 (7) TMI 11 - AT - Income TaxRectification of mistake - Penalty u/s 271(1)(c) - as per notice assessee had faulted on both the charges i.e. having concealed particulars of income as well as furnished inaccurate particulars of such income - HELD THAT:- According to us, sometimes in some cases, it may attract both the offences and in some cases there may be overlapping of the two charges, then in such event in the penalty proceedings also notice should clearly specify the same by adding the adjunctive ‘and’ and not the disjunctive ‘or’. The omission of the AO to strike of ‘or’ between the two charges and write/add ‘and’ in between both the charges makes the notice vague. So, even if the AO is of the opinion that action/omission of assessee attracts both the charges, then it was incumbent upon him, to put the assessee on notice by expressing his intention to proceed against the assessee for both charges by striking out ‘or’ and substituting it with ‘and’ which AO has failed to do in this case. AO by not bothering even to do the exercise as suggested by us reveals the mechanical approach of issuing penalty notice which action exposes the non-application of the mind on the part of the AO to put the assessee on clear notice for which he intends to levy penalty. Moreover, it has to be kept in mind that the assessment proceeding is distinct from the penalty proceedings and it is a settled law that imposition of penalty is discretionary and not mandatory. Any observation or finding made in the assessment order cannot come to the rescue of the AO’s action of issuing defective/vague penalty notice. So, in the facts and circumstances discussed supra, the Misc. Application filed by the Revenue fails since we find no error leave alone error apparent on the face of the impugned order of the Tribunal.
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