GST Helpdesk   Subscription   Demo   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
What's New Case Laws Highlights Articles News Forum Short Notes Statutory TMI SMS More ...
Extracts
Home List
← Previous Next →

2015 (12) TMI 1518 - ITAT MUMBAI

2015 (12) TMI 1518 - ITAT MUMBAI - TMI - Penalty under section 271(1)(c) - Held that:- Respectfully following the decision of the Hon'ble Karnataka High Court in the case of Manjunatha Cotton & Ginning Factory reported in (2013 (7) TMI 620 - KARNATAKA HIGH COURT) we hold that the notice issued under section 274 r.w.s. 271 of the Act dated 30.12.2009 for A.Y. 2007-08 for initiating penalty proceedings under section 271(1)(c) of the Act in the case on hand is invalid and consequently, the penalty .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

efly, are as under: - 2.1 The assessee, a company engaged in the business of trading and brokerage in commodity futures market with MCX, filed its return of income for A.Y. 2007-08 on 29.10.2007 declaring income of Rs.,14,32,310/-. The case was taken up for scrutiny and the assessment was completed under section 143(3) of the Act vide order dated 30.12.2009 wherein the income of the assessee was determined at ₹ 59,32,310/-, in view of an addition of ₹ 45,00,000/- to the returned inco .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

aid amount of ₹ 45,00,000/-. 2.2 On appeal, the learned CIT(A)-38, Mumbai, vide order dated 30.11.2010, dismissed the assessee's appeal and confirmed the levy of penalty under section 271(1)(c) of the Act. 3. Aggrieved by the order of the CIT(A)-38, Mumbai dated 30.11.2010 confirming the levy of penalty of ₹ 16,00,000/- under section 271(1)(c) of the Act for A.Y. 2007-08, the assessee is now in appeal before us, raising the following grounds: - "1.1 The Assistant commissione .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

to separation of profit arising on the transaction made on MCX", without any supporting evidence and only on the basis of conjecture and surmises. 1.3 The appellant submits that it has fully co-operated with the department and as per the advice of the appellant department only, appellant has declared additional income of ₹ 45,00,000/- in order to buy peace and avoid penalty for modification of code carried out by its sub brokers. 1.4 The appellant further submits that the additional .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

r concealment is totally unjustified. 2.1 The appellant craves leave to add, amend or modify all or any of the above grounds of appeal." 4. In the course of hearing on 16.12.2015, the learned A.R. for the assessee brought to the notice of the Bench that the assessee, vide letter dated 09.12.2015, had filed additional grounds of appeal. The additional ground raised reads as under: - "The order of penalty passed under section 271(1)(c) of the Act is bad in law as the notice issued under .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ch is without any mention of the default of the assessee for which penalty proceedings are initiated (copy of the notice dated 30.12.209 is placed in assessee's paper book-2). The learned A.R. for the assessee also placed before us a copy of the decision of the Bangalore Bench of the Tribunal in the case of Roadlinks India Pvt. Ltd. vs. ACIT in ITA No. 1485/Bang/2013 dated 27.02.2015, wherein the Bench in similar circumstances has admitted the additional ground and disposed off the assessee& .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

4.3 Alongwith the application for admission of additional grounds, the assessee has also filed a copy of the notice issued under section 274 r.w.s. 271 of the Act dated 30.12.2009 for initiating of the penalty proceedings under section 271(1)(c) of the Act for A.Y. 2007- 08. The learned A.R. for the assessee also placed before the Bench, for our perusal, the original notice issued by the AO. A perusal of the notice issued under section 274 r.w.s. 271 of the Act dated 20.12.2009 (copy placed at p .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

2546 of 2005 dated 13.12.2012, relied on by the assessee, has held that such a notice, as has also been issued in the case on hand, is invalid and the consequential penalty proceedings are also not valid. The relevant portion of their Lordships judgement at paras 59 to 62 thereof are extracted hereunder for reference: - "59. As the provision stands, the penalty proceedings can be initiated on various ground set therein. If the order passed by the Authority categorically records a finding r .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

in the nature of civil liability, in fact, it is penal in nature. In either event, the person who is accused of the conditions mentioned in Section 271 should be made known about the grounds on which they intend imposing penalty on him as the Section 274 makes it clear that assessee has a right to contest such proceedings and should have full opportunity to meet the case of the Department and show that the conditions stipulated in Section 271(1)(c) do not exist as such he is not liable to pay p .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

es of natural justice is offended if the show cause notice is vague. On the basis of such proceedings, no penalty could be imposed on the assessee. 60. Clause (c) deals with two specific offences, that is to say, concealing particulars of income or furnishing inaccurate particulars of income. No doubt, the facts of some cases may attract both the offences and in some cases there may be overlapping of the two offences but in such cases the initiation of the penalty proceedings also must be for bo .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

would have the opportunity to meet those grounds. After, he places his version and tries to substantiate his claim, if at all, penalty is to be imposed, it should be imposed only on the grounds on which he is called upon to answer. It is not open to the authority, at the time of imposing penalty to impose penalty on the grounds other than what assessee was called upon to meet. Otherwise though the initiation of penalty proceedings may be valid and legal, the final order imposing penalty would of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

he time the order was passed and further discovery of facts subsequent to the imposition of penalty cannot validate the order of penalty which, when passed, was not sustainable. 61. The Assessing Officer is empowered under the Act to initiate penalty proceedings once he is satisfied in the course of any proceedings that there is concealment of income or furnishing of inaccurate particulars of total income under clause (c). Concealment, furnishing inaccurate particulars of income are different. T .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

RKETING reported in 171 Taxman 156, has held that levy of penalty has to be clear as to the limb for which it is levied and the position being unclear penalty is not sustainable. Thom, when the Assessing Officer proposes to invoke the first limb being concealment, then the notice has to be appropriately marked. Similar is the case for furnishing inaccurate particulars of income. The standard proforma without striking of the relevant clauses will lead to an inference as to non-application of mind .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

Latest Notifications:

    Dated      Category

20-7-2017 Cus (NT)

18-7-2017 IT

18-7-2017 CE (NT)

18-7-2017 CE

18-7-2017 GST CESS Rate

15-7-2017 Kerala SGST

14-7-2017 Andhra Pradesh SGST

14-7-2017 Cus (NT)

14-7-2017 Cus

13-7-2017 Co. Law

13-7-2017 Co. Law

13-7-2017 ADD

13-7-2017 ADD

12-7-2017 Jammu & Kashmir SGST

12-7-2017 Gujarat SGST

12-7-2017 Gujarat SGST

12-7-2017 CGST Rate

12-7-2017 UTGST Rate

12-7-2017 UTGST Rate

12-7-2017 IGST Rate

More Notifications


Latest Circulars:

19-7-2017 Income Tax

18-7-2017 Customs

17-7-2017 Customs

14-7-2017 Income Tax

13-7-2017 Central Excise

13-7-2017 Customs

13-7-2017 Central Excise

13-7-2017 Customs

7-7-2017 Income Tax

7-7-2017 Goods and Services Tax

More Circulars



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version