TMI Blog2017 (10) TMI 538X X X X Extracts X X X X X X X X Extracts X X X X ..... er sub–section (4) of section 271AAA was issued to the assessee - Held that:- When the provision contained under section 271AAA mandates issuance of notice under section 274 of the Act before imposition of penalty, the statutory authority being bound by such statutory provision has to act accordingly and cannot deviate therefrom. In our considered view, non–issuance of notice under section 274 is a serious lapse and jurisdictional error as in the absence of such notice, the Assessing Officer could not have proceeded to impose penalty under section 271AAA of the Act. Therefore, the defect arising from non–issuance of notice under section 274 r/w section 271AAA is not a curable defect as provided under section 292B. In view of the aforesaid, we delete the penalty imposed under section 271AAA of the Act. - ITA no.3549/Mum./2015, ITA no.3548/Mum./2015 And ITA no.3550/Mum./2015 - - - Dated:- 9-10-2017 - SHRI SAKTIJIT DEY, JUDICIAL MEMBER AND SHRI N.K. PRADHAN, ACCOUNTANT MEMBER For The Assessee : Shri Beharilal For The Revenue : Ms. Arju Garodia ORDER PER SAKTIJIT DEY, J.M. Aforesaid appeals by the same assessee are against separate orders of the learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of penalty proceedings in the assessment order, the Assessing Officer has not recorded any satisfaction. Further, in the show cause notice issued under section 274 of the Act, the Assessing Officer has not specified which limb of section 271(1)(c) of the Act is attracted. Therefore, imposition of penalty is not justified. In this context, he relied upon the following decisions CIT v/s Manjunatha Cotton and Ginning Factory, [2013] 359 ITR 565 (Kar.), CIT v/s Samson Perinchery, [2017] 392 ITR 004, Meherji Cassinath Holdings Pvt. Ltd. v/s ACIT, ITA no.2555/Mum./2012, dated 28th April 2017. 6. Learned Departmental Representative supported the order of the Departmental Authorities. 7. We have heard rival contentions and perused the material available on record. On a perusal of the assessment order, we have noticed that the Assessing Officer has simply mentioned penalty proceedings under section 271(1)(c) of the I.T. Act are initiated separately . There is no satisfaction recorded by the Assessing Officer whether the assessee has concealed the particulars of income or has furnished inaccurate particulars of income. Even, in the show cause notice issued under section 274 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were deleted by the Tribunal restricted the penalty imposed under section 271(1)(c) of the Act to the rest of the additions i.e., perquisite value of ₹ 76,000 and unexplained cash of ₹ 1.50 lakh. 12. Learned Authorised Representative submitted, the Assessing Officer while directing for initiation of penalty proceedings under section 271(1)(c) of the Act, has not recorded any satisfaction whether such penalty has to be imposed for concealment of income or furnishing inaccurate particulars of income. Therefore, imposition of penalty is invalid. 13. Learned Departmental Representative relied upon the observations of the learned Commissioner (Appeals). 14. We have heard rival contentions and perused the material available on record. A careful reading of the assessment order and more particularly Para 6.4 of the assessment order, it is evident, the Assessing Officer while making addition of ₹ 1.50 lakh has directed for initiation of penalty proceedings under section 271(1)(c) of the Act. However, he has not recorded any satisfaction whether initiation of penalty proceedings is for furnishing of inaccurate particulars of income or concealing the particulars of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd. The learned Authorised Representative submitted before us that the Assessing Officer has not initiated proceedings for imposition of penalty under section 271AAA as no show cause notice under section 274 of the Act was issued to the assessee. On the basis of aforesaid submissions made by the learned Authorised Representative the Bench directed the learned Departmental Representative to obtain necessary instruction from the Assessing Officer whether show cause notice under section 274 r/w 271AAA was issued to the assessee before imposition of penalty. On the direction of the Bench, the learned Departmental Representative has obtained necessary instructions from the Assessing Officer and has submitted it before the Bench vide letter dated 11th September 2017, copy of which is placed on record. As could be seen, the Assessing Officer vide letter dated 6th September 2017, has communicated to the learned Departmental Representative as under: To The Sr. AR, ITAT J Bench, Mumbai. Madam, Sub: Factual Report in the case of Sh. Surendra Kotadia (PAN : AABPK3637L) reg. Ref: no.CIT(DR)/ITAT/J Bench/2016 17 dt. 07.09.2017 Kindly refer to t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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