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2016 (9) TMI 795 - ITAT BANGALORE

2016 (9) TMI 795 - ITAT BANGALORE - TMI - Penalty u/s 271(1)(c) - defective notice - Held that:- The penalty levied under Section 271(1)(c) on the basis of defective notice under Section 274 is not sustainable and accordingly the same is deleted. - Decided in favour of assessee - I.T.A. Nos.187 & 188/Bang/2014 - Dated:- 29-7-2016 - SHRI VIJAY PAL RAO, JUDICIAL MEMBER For The Appellant : Smt. Pratibha R, Advocate. For The Respondent : Smt. Renuka Devi, JCIT (D.R) ORDER These two appeals by the as .....

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ative as well as learned Departmental Representative and considered the Affidavit filed by the assessee explaining the delay in filing the appeals. The ld. AR has referred to the contents of the Affidavit and submitted that the delay in filing the appeal is due to time taken in appointing Chartered Accountant to look after the income tax matters in fling the appeals and the assessee has undergone cryopexy under LA treatment of left eye and was advised complete rest for 8 weeks form 25.1.2010 onw .....

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ter seriously as there was a delay of 4 years before the CIT (Appeals). Thus the ld. DR has submitted that the assessee has not explained the delay in filing the appeal. 5. Having considered the rival submissions as well as the relevant material on record, it is noted that the assessee has filed the medical record to show that the assessee has undergone eye treatment on 20.10.2005 in Shekar Netralaya, Bangalore. The assessee has pleaded that she has again undergone the left eye cryopexy under LA .....

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e quantum appeal, the assessee has raised the following grounds : 1. On the facts and in the circumstances of the case, the learned CIT (Appeals) erred in passing the order in the manner he did. 2. On the facts and in the circumstances of the case, the learned CIT (Appeals) ought to have condoned the delay in filing the appeal, given an adequate opportunity to the appellant to explain the sufficient cause for the delay as the delay was caused by the authorized representative of the appellant whi .....

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have heard the learned Authorised Representative as well as learned Departmental Representative and considered the relevant material on record. There was a delay of four years in filing the appeal before the CIT (Appeals) and the CIT (Appeals) declined to condone the delay on the ground that the assessee has failed to explain the delay. The only explanation furnished by the assessee before the CIT (Appeals) is that the assessee has undergone the left eye cryopexy under LA treatment. It is pertin .....

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d the facts and circumstances of the case this Tribunal do not find any error or illegality in the order of the appeal for condonation of delay of four years. Accordingly, the appeals filed against the assessment order passed under Section 143(3) of the Income Tax Act, 1961 (in short 'the Act') deserves dismissal. Further it is noted that the assessee has not produced the relevant record in support of the claim of deposit of ₹ 25 lakhs in the bank account. It is pertinent to note t .....

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ase is not fit for admitting the additional evidence filed by the assessee at this stage that too is not a complete evidence in support of the claim but the assessee has filed the alleged confirmation letters in respect of the part of the amount. Accordingly, in the peculiar facts and circumstances of the case, the additional evidence filed by the assessee at this stage cannot be admitted. Hence the appeals filed by the assessee arising from the assessment order is dismissed. 8. In the penalty a .....

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learned CIT (Appeals) ought to have appreciated that the Appellant was doing saree business among the family members and close friends circle and declared a turnover of ₹ 32.36 lakhs which is not covered under Section 44AB of the IT Act. Accordingly, the profit has been arrived under Section 44AF at 5% on the turnover and taxes have been paid on the same. 4. The learned CIT (Appeals) ought to have appreciated the reasonable cause and hardship of the Appellant for not furnishing the proof f .....

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d at the time of hearing. the Appellant prays that the appeal may be allowed. 9. The assessee has also raised additional ground which reads as under : 1. The Assessing Officer having issued the notice under Section 274 read with section 271(1)(c) of the Act in a mechanical manner, the penalty order passed under Section 271(1)(c) of the Act is not sustainable in the eye of law. 2. The appellant begs to submit that the decision of the jurisdictional High Court in the case of CIT Vs. Manjunatha Cot .....

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er Section 274 r.w.s. 271(1)( c ) of the Act and supported the same with the judgment of Hon'ble jurisdictional High Court in the case of Manjunatha Cotton & Ginning Factory reported in 359 ITR 565. Since the additional grounds raised by the assessee does not require any fresh investigation of facts therefore, in the facts and circumstances of the case and in view of the judgment of Hon'ble Supreme Court in the case of NTPC Ltd. Vs. CIT 229 ITR 383, the additional ground raised by th .....

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on'ble jurisdictional High Court dt.25.1.2016 in the case of Safina Hotels Pvt. Ltd. Vs. CIT, Bangalore III & Another in ITA No.240/2010 wherein the Hon'ble High Court has reiterated the principle as laid out in the case of CIT Vs. Manjunatha Cotton & Ginning Factory (supra). 12. On the other hand, the ld. DR has relied upon the orders of authorities below. 13. Having considered the rival submissions and material on record, it is noted that the Assessing Officer has initiated the .....

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gh Court in the case of CIT Vs. Manjunatha Cotton & Ginning Factory (supra) has held that the notice under Section 274 of the Act should specifically state the ground mentioned in 271(1)(c) of the Act i.e. whether it is for concealment of income or furnishing of inaccurate particulars of income. Sending printed form where all the grounds mentioned in the section 271(1) are mentioned would not satisfy the requirement of law. By considering the said decision, the Hon'ble jurisdictional Hig .....

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clusion part at para.63 of the said judgment, in clauses n,p,q,r, it is held thus: "(n) The direction referred to in Explanation IB to Section 271 of the Act should be clear and without any ambiguity. (p) Notice under Section 274 of the Act should specifically state the grounds mentioned in Section271(1)(c), i.e., whether it is for concealment of income or for furnishing of incorrect particulars of income. (q) Sending printed form where all the ground mentioned in Section 271 are mentioned .....

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