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2018 (10) TMI 132

e issued u/s 274 r.w.s. 271 dated 31.03.2004 shows that the inappropriate words in the said notice have not been struck off and it is a printed notice. Even the last line of the said notice only speaks of section 271 and does not even mention of section 271(1)(c) of the I.T. Act. - We find an identical issue had come up before this Bench of the Tribunal in the case of Sahiwal Investment & Trading co. vs. ITO [2018 (7) TMI 1472 - ITAT DELHI] holding the notice issued by the Assessing Officer under Section 274 read with Section 271(1)(c) to be bad in law as it did not specify which limb of Section 271(1)(c) of the Act, the penalty proceedings had been initiated i.e., whether for concealment of particulars of income or furnishing of inacc .....

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earing of this appeal. 3. Facts of the case, in brief, are that the assessee is an individual and derives income from salary, house rent and income from other sources. He filed his return of income on 30.07.2009 declaring total income of ₹ 40,25,560/-. In this case, a search and seizure operation u/s 132 of the I.T. Act, 1961 was carried out on 20.01.2012. In response to notice u/s 153A, the assessee filed his return of income on 10.10.2013 declaring total income of ₹ 43,95,120/-. In the computation of income filed along with return of income, the assessee has submitted as under :- The other income of ₹ 1,50,000/- declared under the head Income from other sources is to cover up any addition on account of any entry in the s .....

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by the Assessing Officer. 7. Aggrieved with such order of the ld. CIT(A), the assessee is in appeal before the Tribunal. 8. The ld. counsel for the assessee, at the outset, referred to the notice issue u/s 274 r.w.s. 271 dated 31.03.2017 and submitted that the inappropriate words in the said notice have not been struck off. Therefore, it is not understood as to under which limb of provisions of section 271(1)(c) the Assessing Officer has levied penalty since the said show-cause notice issued u/s 274 did not specify the charge against the assessee as to whether it was for concealing the particulars of income or for furnishing inaccurate particulars of income. Therefore, the penalty order passed u/s 271(1)(c) in pursuance to the said notice .....

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#39;ble High Court in the said decision has held that where notice did not show nature of default, it was a question of fact. The assessee had understood the purport and import of notice and hence no prejudice was caused to the assessee. The Hon'ble High Court while referring to this decision has considered the decision of the Hon ble Karnataka High Court in the case of CIT vs. Manjunatha Cotton & Ginning Factory reported in 359 ITR 565. 12. Referring to the decision of the Hon ble Bombay High Court in the case of CIT vs. Smt. Kaushalya reported in 216 ITR 660 he submitted that the Hon'ble High Court in the said decision has held that mere mistake in language used or mere non-striking off of inaccurate portion cannot by itself i .....

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ng the sustainable of penalty levied u/s 271(1)(c) when the inappropriate words in the notice issued u/s 274 r.w.s. 271 have not been struck off. A perusal of the notice issued u/s 274 r.w.s. 271 dated 31.03.2004 shows that the inappropriate words in the said notice have not been struck off and it is a printed notice. Even the last line of the said notice only speaks of section 271 and does not even mention of section 271(1)(c) of the I.T. Act. We find an identical issue had come up before this Bench of the Tribunal in the case of Sahiwal Investment & Trading co. vs. ITO vide ITA No.4913/Del/2015 for assessment year 2006-07 order dated 18.07.2018 to which both of us parties. We find the Tribunal in the said decision while allowing the a .....

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n of the Division Bench of this Court rendered in the case of COMMISSIONER OF INCOME TAX -VS- MANJUNATHA COTTON AND GINNING FACTORY (2013) 359 ITR 565. 4. In our view, since the matter is covered by judgment of the Division Bench of this Court, we are of the opinion, no substantial question of law arises in this appeal for determination by this Court. The appeal is accordingly dismissed." Thus, Additional Ground No. (ii) of the assessee's appeal is allowed. Since the inception of the notice issued u/s 271(1)(c) has become null and void, there is no need to comment on merit of the case. The Penalty u/s 271(1)(c) of the Act is quashed. 16. Since in the instant case also the inappropriate words in the penalty notice has not been struc .....

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