TMI Blog2018 (5) TMI 1804X X X X Extracts X X X X X X X X Extracts X X X X ..... deration cannot be sustained in the eyes of law. We accordingly quash all the six penalty orders and allow this common legal ground. - Decided in favour of assessee. - ITA Nos.136 to 141/Ind/2017 - - - Dated:- 16-5-2018 - SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER For The Appellant : Shri B.K. Nema Miss Megha Nema, Advocates For The Respondent : Shri K.G. Goyal ORDER PER BENCH This bunch of 6 appeals in case of the assessee pertaining to the assessment years 2002-03 2004-05 to 2008-09 is directed against different orders of the Commissioner of Income Tax (Appeals)-I, Bhopal, all dated 7.12.2016 arising out of different orders u/ 271(1)(c) of Income Tax Act (in short referred as Act ) Act framed by the ACIT 1(1), Bhopal. 2. Since common issue is involved, these appeals were heard together and are being disposed of by this consolidated order for the sake of convenience. 3. Briefly stated, the facts, as culled out from record, are that search and seizure operations were carried out u/s 132(1) of the Act on 7.9.2007 at the residential premises of the assessee. Protective assessments were made in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w. 5. The learned counsel for the assessee submitted written submissions as under :- Ground No. 4 : Show Cause Notice for Initiation and Levy of Penalty u/s 271(1)(c). (P- 170 to 177) [Vol.-I] A) Notice issued u/s 271(1)(c) is in printed proforma and no specific charge is specified for which penalty u/s 271(1)(c) of I.T. Act 1961 is sought to be levied. B) The penalty levied in respect to show cause notice which is bad in law as observed hereinabove is unsustainable. Reliance on: i) (2017) 98 CCH 0039 Mum HC CIT vs. Samson Pernchery (P- 95 98)(95)[Vol.-I] ii) Supreme Court order Petition(s) for Special Leave to Appeal (C) ... ../2016 (CC No.11485/2016) in the case of M/s. SSA s Emerald Meadows vide order dated 05/08/2016. (P- 99) [Vol.-I] i) Hon ble High Court of Karnataka at Bengaluru order in ITA No.380 of 2015 in the case of M/s. SSA s Emerald Meadows vide order dated 23/11/2015. (P- 100 103)(102, 103) [Vol.-I] ii) Hon ble High Court of Hyderabad in the case of Smt. Baisetty Revathi in ITTA No.684 of 2016 vide judgement dated 13/07/2017. (P- 141 151) (149, 150, 151) [Vol.-I] v) Hon ble ITAT, Jaipur Bench, Jaipur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndian Incometax Act, 1961 or under section 142(1)/143(2) of the Income tax Act, 1961, No .dated. have concealed the particulars of your income or have furnished inaccurate particulars of such income. Section 271(1)(c) of the Act(1)(c). xxx xxx xxx 8. Similar notices were also made for the assessment years 2004-05 to 2008-09. Under these notices, the reason given by the Assessing Officer is an allegation which is not specific. The Assessing Officer has alleged that either the assessee has concealed the particulars of income or has furnished inaccurate particulars of income. It is clearly visible from the notice that at the time of initiation of penalty proceedings the Assessing Officer has not made specific satisfaction as to whether the assessee is guilty of concealing the particulars of income or furnishing inaccurate particulars of income. Similarly, when the Assessing Officer finally framed the penalty order on 31.7.2015 in para 8 of the impugned order the Assessing Officer observed that I am satisfied that the assessee has concealed the particulars of income or furnished inaccurate particulars of such income within the meaning of section 271(1)(c) of the Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fficer should give a specific finding. In the present case, in the assessment order as noted above the assessing officer has stated that the assessee has concealed/furnished the inaccurate particulars of income. Therefore, the penalty under Section 271(1) (c) was also initiated, from this it can not be inferred whether there is specific charge of concealing the particulars of income or furnished the inaccurate particulars of such income Law is well settled that the assessing officer has to come to a definite satisfaction whether the assessee has concealed the income of particulars or furnished the inaccurate particulars of income. The Hon ble Karnataka High Court in the case of CIT and Another Vs. Manjunatha Cotton and Ginning Factory,359 ITR 565(Kar.) has held that the notice u/s 274 of the Act should specifically state as to whether penalty is being proposed for concealment of particulars of income or inaccurate particulars of income. In the present case notice under section 274 dated 25/3/2015 enclosed at paper book page 16 reads as under: Penalty Notice Under Section 274, Read with Section 271 of the IT Act. 1961 Whereas in the course of proceedings before me for the Assessme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n contained in sub-section (1B). (h) The said deeming provisions are not applicable to the orders passed by the Commissioner of Income-tax (Appeals) and the Commissioner. (i) The imposition of penalty is not automatic. (j) The imposition of penalty even if the tax liability is admitted is not automatic. (k) Even if the assessee has not challenged the order of assessment levying tax and interest and has paid tax and interest that by itself would not be sufficient for the authorities either to initiate penalty proceedings or impose penalty, unless it is discernible from the assessment order that, it is on account of such unearthing or enquiry concluded by the authorities it has resulted in payment of such tax or such tax liability came to be admit ted and if not it would have escaped from tax net and as opined by the Assessing Officer in the assessment order. (l) Only when no explanation is offered or the explanation offered is found to be false or when the assessee fails to prove that the explanation offered is not bona fide, an order imposing penalty could be passed. (m) If the explanation offered, even though not substantiated by the assessee, but is found to be bona fide and all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case of the assessee is squrely covered by this decision. We, therefore, in the given facts and circumstances of the case, are of the considered view that initiation of penalty proceedings by way of issuing notice u/s 274 r.w.s. 271(1)(c) of the Act do not meet the requirements as envisaged in the provisions of law and, therefore, all the six penalty orders under consideration cannot be sustained in the eyes of law. We accordingly quash all the six penalty orders and allow this common legal ground no. 4 raised by the assessee in all these six appeals thereby deleting penalty of ₹ 60,000/- for the assessment year 2002-03, ₹ 2,50,000/- for the assessment year 2004-05, ₹ 8,00,000/- for the assessment year 2005-06, ₹ 21,00,000/- for the assessment year 2006-07 and ₹ 11,50,000/- for the assessment year 2007-08 and ₹ 1,55,000/- for the assessment year 2008-09 10. Apropos other common grounds which relate to merits of the case, we find it academic to deal with the same as we have already deleted the impugned penalty u/s 271(1)(c) of the Act at ₹ 60,000/- for the assessment year 2002-03, ₹ 2,50,000/- for the assessment year 2004-05, &# ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
