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 →

2017 (1) TMI 1034 - ITAT PUNE

2017 (1) TMI 1034 - ITAT PUNE - TMI - Levy of penalty u/s. 271(1)(c) - invalid notice - Held that:- In view of the fact that the notice issued for levy of penalty u/s. 271(1)(c) is ambiguous and vague and does not specify the charge for levy of penalty, the same is held to be bad in law and hence the subsequent proceedings arising there from are vitiated. The impugned order is set aside and the appeal of the assessee is allowed. - ITA No. 2089/PUN/2012 - Dated:- 18-1-2017 - SHRI R.K. PANDA, AM A .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d grain items on wholesale basis. The assessee filed his return of income for the assessment year 2007-08 on 31-10-2007 declaring total income of ₹ 4,57,030/-. A survey u/s. 133A of the Act was carried out on the business premises of Chhablani Group on 24-08-2009. During the course of survey the assessee voluntary declared ₹ 43,00,000/- as additional income for assessment year 2007-08 and offered the same for tax by way of revised return of income filed on 29-09-2009. The Assessing O .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of Income Tax (Appeals). The Commissioner of Income Tax (Appeals) vide impugned order rejected the contentions of the assessee and confirmed the order levying penalty u/s. 271(1)(c) of the Act. Now, the assessee is in second appeal before the Tribunal. 3. Shri Rajiv Thakkar appearing on behalf of the assessee submitted that the order levying penalty is bad in law as there was no concealment of income or furnishing of inaccurate particulars of income in the return filed by the assessee. The revis .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

f the Act dated 07-12-2010 does not specify the charge for which the penalty proceedings are initiated. The Assessing Officer has not struck off the irrelevant parts of the proforma notice. It is a well settled law that notice issued without specifying the charge for levy of penalty is not sustainable and the subsequent proceedings arising therefrom are liable to be set aside. In support of his submissions the ld. AR placed reliance on the decision of Hon ble Karnataka High Court in the case 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

Commissioner of Income Tax (Appeals). The ld. DR submitted that a perusal of the impugned order confirming the penalty u/s. 271(1)(c) of the Act would clearly shows that penalty has been levied for concealment of income. The ld. DR contended that the assessee declared additional income only because of survey action. If survey action wouldn t have been carried out the additional income declared by the assessee would have escaped tax net. 5. We have heard the submissions made by the representative .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

f the Act at page 17 of the paper book. A perusal of the notice reveal that irrelevant parts of the notice has not been struck off. Thus, the notice does not clearly specify whether the penalty u/s. 271(1)(c) has been levied for concealment of income or furnishing of inaccurate of particulars of income. The Hon ble Karnataka High Court in the case of Commissioner of Income Tax Vs. Manjunatha Cotton and Ginning Factory reported as 359 ITR 565 has held that, when the Assessing Officer proposes to .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ulars of income. Sending printed form where all the grounds for levy of penalty u/s. 271(1)(c) are mentioned would not satisfy requirement of law. The assessee should know the grounds which he has to meet specifically. Otherwise, principles of natural justice would be offended. On the basis of such proceedings, no penalty could be imposed on the assessee. 6. The Co-ordinate Bench of the Tribunal in the case of Kanhaiyalal D. Jain Vs. The Asstt. Commissioner of Income Tax in ITA No. 1201 to 1205/ .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

5. The Hon ble Karnataka High Court has laid down the proposition that the Assessing Officer is to be satisfied in the course of proceedings that there is either concealment of income or furnishing of inaccurate particulars of income under clause (c) to section 271(1) of the Act. It has been categorically held that concealment of income and furnishing of inaccurate particulars of income are different. The Hon ble High Court has thus, laid down that the Assessing Officer while issuing notice has .....

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 first limb being concealment, then the notice has to be appropriately marked. Similarly, for furnishing inaccurate particulars of income, the standard proforma without striking of relevant clauses, as per the Hon ble High Court would lead to inference as to non-application of mind. 16. Further, the Hon ble Karnataka High Court in CIT Vs. SSA S Emerald Meadows (supra) has dismissed the appeal of Revenue, where the Tribunal had allowed the appeal of assessee holding that the notice issued by th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nstruction Vs. Addl. CIT (supra) and in Sanjog Tarachand Lodha Vs. ITO (supra) have applied the ratio laid down by the Hon ble Karnataka High Court (supra) and held that where there is no striking off of either of limbs, then notice issued under section 274 r.w.s. 271(1)(c) of the Act was invalid and subsequent penalty proceedings were held to be vitiated. The Co-ordinate Bench further held : 23. However, the question which is raised before us by way of additional ground of appeal is root of sta .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

furnishing of particulars of income against additional income offered by the assessee is incorrect. Further, where the assessee is not aware of exact charge against him, the ambiguity in the notice issued under section 274 r.w.s. 271(1)(c) of the Act by not striking of portion which is not applicable, prejudice the right of reasonable opportunity to the assessee, as he was not made aware of exact charge he had to face. It is a clear-cut case of concealment since the assessee had offered additio .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

on that the Assessing Officer has to make the assessee fully aware of exact charge of the Department against him. As pointed out, in present case, in the assessment order itself while recording satisfaction for initiating proceedings under section 271(1)(c) of the Act, exact charge of the Department against the assessee is not clear. The Assessing Officer records the satisfaction for initiating penalty proceedings on both the counts i.e. concealment of income and furnishing of inaccurate particu .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

xact charge of the Department, then initiation of penalty proceedings are vitiated and the same are to be quashed. The issue of notice under section 274 of the Act on such vagueness and ambiguity makes such notice invalid and proceedings thereafter are to be quashed. 25. The Hon ble Supreme Court in T. Ashok Pai Vs. CIT (supra) had held as under:- 23. Section 271(1)(c) remains a penal statute. The rule of strict construction shall apply thereto. The ingredients for imposing penalty remain the sa .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

Advanced Search


Latest Notifications:

    Dated      Category

20-7-2017 Cus (NT)

20-7-2017 IT

20-7-2017 GST CESS Rate

19-7-2017 IT

19-7-2017 IT

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

More Notifications


Latest Circulars:

21-7-2017 Goods and Services Tax

20-7-2017 Goods and Services Tax

20-7-2017 Goods and Services Tax

19-7-2017 Goods and Services Tax

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

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