TMI Blog2017 (3) TMI 1576X X X X Extracts X X X X X X X X Extracts X X X X ..... ondent by : Shri Sanjeev Ghai ORDER Anil Chaturvedi, This appeal of the assessee is emanating out of the order of Commissioner of Income Tax (A) 12, Pune dated 10.02.2015 for the assessment year 2005-06. 2. The relevant facts as culled out from the material on record are as under :- 2.1 A search action u/s 132 of the Act was conducted on 24.10.2007 at the residential premises of the assessee at Pimpiri Pune. Thereafter notice u/s 153A(a) was issued on 20.06.2008 and in response to which assessee filed return of income for A.Y. 2005-06 on 12.08.2008 declaring total income at ₹ 97,58,950/-. The case was taken up for scrutiny and thereafter assessment was framed u/s 143(3) r.w.s 153A of the Act vide order dt.31.12.2009 and the total income was determined at ₹ 1,25,09,840/- inter-alia by treating the long term capital gains shown by the assessee of ₹ 93,49,445/- as income from other sources . Aggrieved by the order of AO, assessee preferred appeal before Ld. CIT(A), who vide order 10.02.2015 dismissed the appeal of the assessee. On the treatment of capital gains as income from other sources, AO vide order dt.21.03.2013 held the assessee t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the decision relied on by the Appellant in which, penalty was deleted after confirmation of the amount in the quantum penalty, are not relevant to the facts of the case. Levy of the penalty u/s 271(1)(c) would depend on the facts of the each case and there cannot be a precedent to be followed on the deletion of the penalty even after sustaining of the amount of the addition in the quantum appeal. 2.1.8 As far as facts of are concerned, following factual features of the case re relevant: 1) The Appellant did not carry out share trading before the trading in shares of Tanu Health Care. 2) Although the companies, Tanu Health care and Comfort Intech were found to be listed on the BSE, the shares of these companies were dormant without any trading in them. 3) The address of Tanu Health Care as per the PAN database is of the Cyber Caf in Mumbai and on actual inquiry, it was found that there is no such office at the given address. The given address is only a mailing address, from where dak is collected at the frequent intervals. 4) The Appellant has purchased the shares in March 2004 but the payment towards the shares was made only after the year in April 2005. This has h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntical issue. These orders are:- i) Ratanshi Patel ITA No.167/PN/12 dated 19/9/2013. ii) Krishnagopal Chandak ITA No.2465/PN/2012 dated 25/11/2014. 4. Assessee subsequently raised an additional ground which reads as under :- On the facts and in the circumstances of the case the orders passed by the Assessing Officer levying the penalty u/s 271(1)(c) is bad in law in as much as there exists total vagueness, ambiguity and non application of mind of the Assessing Officer in initiation and completion of the penalty proceedings (Refer decision of Bombay High Court in the case of Samsung Perichery) 5. With respect to the prayer for admission of additional ground it was submitted that it being a legal ground and since it goes to the root of the issue, the additional ground be admitted. Ld.D.R. did not seriously object to the admission of additional ground. Considering the aforesaid submissions, the additional ground is admitted. Since the additional ground and the other grounds are with respect to levy of penalty and are being inter-connected, all the grounds are considered together. 6. Assessee had earned profits on sale of shares and had claimed it as long term ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hen the notice has to be appropriately marked. Similar is the case for furnishing inaccurate particulars of income. He submitted that as the High Court has further held that the standard proforma without striking of the relevant clauses will lead to inference for non-application of mind by the AO. He further submitted that in the penalty order passed u/s 271(1)(c) of the Act, AO has recorded the satisfaction by stating that assessee has furnished inaccurate particulars of income and thereby concealed his income and submitted that Ld. CIT(A) in the order dt.10.02.2015 while confirming the penalty order passed by AO has held that it was the case of concealment as well as furnishing of inaccurate particulars of income. He therefore submitted that AO has not applied his mind while recording satisfaction and at the time of issuance of notice u/s 274 of the Act and has not specified the charge for levy of penalty as the AO was himself not clear as to under which limb of Sec.271(1)(c) penalty was leviable. He therefore submitted that the penalty proceedings are initiated without application of mind by AO and therefore the penalty order levied by the AO is bad and therefore the penalty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssing Officer while recording satisfaction has observed that, the assessee has concealed the income and has also furnished inaccurate particulars of income within the meaning of section 271(1)(c) of the Act. While issuing notice the Assessing Officer has not struck off irrelevant part in the show cause notice issued u/s. 274 and thus, the relevant extract of notice indicating charge for levy of penalty reads as under : have concealed the particulars of your income or furnished inaccurate particulars of such income. 6. It is clearly evident from the perusal of notice that the Assessing Officer is not clear as to under what charge penalty has to be levied u/s. 271(1)(c) of the Act. The notice is vague as it fails to clearly spell out the charge for levy of penalty. A further examination of the records show that the observations of the Assessing Officer are inconsistent while recording satisfaction and at the time of passing of the penalty order. The Assessing Officer has levied penalty for furnishing inaccurate particulars of income. The Assessing Officer is incoherent in reasoning for recording satisfaction and in passing the order levying penalty. 7. The Hon ble Bombay Hi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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