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2020 (9) TMI 532 - AT - Income TaxPenalty u/s 271AAB - Defects in the notice issued u/s 274 - undisclosed income surrendered during the course of search conducted u/s 132 - penalty notice under the heading of Section 274 r.w.s. 271AAB of the Act pre printed format of issuing notice u/s 271(1)(c) - HELD THAT:- Tribunal in the case of Dr. Rajesh Jain [2020 (2) TMI 946 - ITAT INDORE] and after examining the fact find that the facts are verbatim similar wherein defective notice was issued u/s 274 r.w.s. 271AAB of the Act, without specifying the charges for which penalty proceedings were initiated. In other words in the notice issued u/s 274 r.w.s. 271AAB assessee has not been given an opportunity to offer explanation against the type of penalty to be levied i.e. whether the penalty is to be under Clause (a), (b) or (c) of Section 271AAB. In the instant case defect is much more grave because in the penalty notice under the heading of Section 274 r.w.s. 271AAB of the Act pre printed format of issuing notice u/s 271(1)(c) is appearing which relates to levy of penalty for concealment of particulars of income or furnishing inaccurate particulars of income. In the assessee’s case Ld. A.O ought to have mentioned the specific charges provided u/s 271AAB of the Act rather than the charges of Section 271(1)(c) of the Act. CIT(A) reduced the penalty to 10% applying provisions of Section 271AAB(a) of the Act as against penalty levied @30% by the Ld. A.O u/s 271AAB(c) of the Act but to our surprise Ld. CIT(A) has not taken pain to issue a fresh notice before reducing the penalty thus not giving reasonable opportunity of being heard as mandated under the proviso to Section 275. We find that similar issue came up before us in the case of Shri Vivek Chug [2019 (4) TMI 1163 - ITAT INDORE] wherein the appeal was decided in favour of the assessee and penalty proceedings were quashed since Ld. CIT(A) partly deleted the penalty by confirming the penalty @10% as against 20% levied by Ld. A.O u/s 271AAB of the Act without affording reasonable opportunity to the assessee to make necessary submission of the explanation. Since the penalty notice issued u/s 274 r.w.s. 271AAB is vague and does not fulfill the requirement of law since no specific charges provided u/s 274 r.w.s. 271AAB of the Act are appearing in the body of penalty notice. Since the penalty proceedings has been quashed and legal ground allowed in favour of the assessee.
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