TMI Blog2019 (1) TMI 742X X X X Extracts X X X X X X X X Extracts X X X X ..... ear 2014-15. Since the issues involved in these appeals are common and identical, hence, the appeals were heard together and are being disposed of by this common order for the sake of convenience, by dealing with ITA No. 7091/Del/2018 (AY 2014-15) Jagdish Prasad Avdesh Kumar- HUF and by only reproducing the grounds of this appeal. 2. The following grounds have been raised by the Assessee in Appeal No. 7091/Del/2018 (AY 2014-15):- Invalid penalty orders u/s. 271(1)(c) : jurisdictional challenge 1. That on the facts and in the circumstances of the case and in law, Ld. CIT(A) erred in sustaining the penalty order passed by the AO u/s. 271(1)(c) as in assessment order passed dated 26.12.2016 same is delightfully vague as to requisite satisfaction of AO to validly initiate penalty proceedings u/s. 271(1B) of the Act and said assessment order also does not disclose under which specific limb penalty charge is made by the AO, accordingly penalty order passed by AO and order of Ld. CIT(A) may please be quashed; 2. That on the facts and in the circumstances of the case and in law, Ld. CIT(A) erred in sustaining the penalty order passed by AO u/s. 271(1)(c) as AO has levi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be scrutinized and examined by revenue authorities; 4. That on the facts and in the circumstances of the case and in law, Id CIT-A erred in sustaining the penalty order passed by Ld AO u/s 271(l)(c) without appreciating any of the contention of assessee, ergo, penalty order passed by Ld AO and order of Ld CIT-A may please be quashed; That the appellant craves leave to add / alter any/all grounds of appeal before or at the time of hearing of the appeal. 3. I will first take up the appeal in the case of Jagdish Prasad Avdesh Kumar HUF being ITA No. 7091/Del/2018 (AY 2014-15) and my finding given therein will apply mutatis mutandis in other appeal, since similar facts and findings are permeating in other appeal also. 4. The brief facts of the case are that return of income declaring total income at ₹ 4,51,430/- was filed by the assessee on 15.07.2014. The case of the assessee was processed u/s 143(1) of the I.T. Act, 1961. The assessee during the year was deriving income under the garb of Income from other sources. As per the AIR information during the year under review, it was observed by the AO that assessee has made investment in the shares and earned long t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 4,33,132/- was imposed vide order dated 28.6.2017 u/s. 271(1)(c) of the Act. Against the penalty order dated 28.6.2017, assessee appealed before the Ld. CTI(A), who vide his impugned order dated 13.7.2018 has dismissed the appeal of the assessee. 5. At the time of hearing, Ld. Counsel of the Assessee has stated that assessee has raised 04 grounds of appeal, but he is arguing only the ground no. 1 which is legal in nature. He stated that Ld. CIT(A) has wrongly sustained the penalty order passed by the AO u/s. 271(1)(c) as in assessment order passed dated 26.12.2016 same is delightfully vague as to requisite satisfaction of AO to validly initiate penalty proceedings u/s. 271(1B) of the Act and the said assessment order also does not disclose under which specific limb penalty charge is made by the AO, accordingly penalty order passed by AO and order of Ld. CIT(A) may please be quashed. He draw my attention towards the assessment order dated 26.12.2016 passed u/s. 143(3) of the I.T. Act, 1961 especially the last page of the assessment order and stated that the AO has initiated the penalty proceedings u/s. 271(1)(c) read with section 274 of the I.T. Act on being satisfied tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovisions of law. I am also of the view that assessment order issued by the AO is bad in law as it does not specify under 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 inaccurate particulars. Therefore, the penalty in dispute is not sustainable in the eyes of law. My aforesaid view is supported by the following decisions:- i) CIT Anr. Vs. M/s SSA s Emerald Meadows 2015 (11) TMI 1620 Karnataka High Court has held that Tribunal has correctly allowed the appeal filed by the assessee 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 inaccurate particulars of income. The Tribunal, while allowing the appeal of the assessee, has relied on the decision of the Division Bench of this Court rendered in the case of Commissioner of Income Tax vs. Manjunatha Cotton and Ginning Factory (2013) (7) TMI 620- Karanataka High Court. Thus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g of inaccurate particulars of income. The Tribunal, while allowing the appeal of the assessee, has relied on the decision of the Division Bench of this Court rendered in the case of Commissioner of Income Tax vs. Manjunatha Cotton and Ginning Factory (2013) (7) TMI 620- Karanataka High Court. Thus 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 decided in favour of assessee. ii) CIT Anr. Vs. M/s SSA s Emerald Meadows Hon ble Supreme Court of India reported in 2016 (8) TMI 1145 Supreme Court. The Apex Court held that High Court order confirmed (2015) (11) TMI 1620 (Supra) Karnataka High Court. Notice issued by AO 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 inaccurate particulars of income Decided in favour of assessee. 8. In the background of the aforesaid discussions and respectfully following the precedents, we delete the penalty in dispute and decide the issue in f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has recorded his satisfaction on the page 2, 2nd para viz. I am satisfied that it is a fit case for initiation of penalty proceedings u/s. 271(1)(c) of the Act for furnishing inaccurate particulars of income/concealment of income. Further the AO vide his Notice dated 31.12.2007 for initiating the penalty and directed the assessee to appear before him at ---------AM/PM on -------- 200------ and issued a Show Cause to the assessee stating therein that why an order imposing the penalty of amount should not be made u/s. 271(1)(c) of the I.T. Act, 1961. After perusing the notice dated 31.12.2007 issued by the AO to the assessee, we are of the view that the AO has initiated the penalty for furnishing inaccurate particulars of income/ concealment of income, but in the penalty order dated 06.11.2009 he has stated that he is satisfied that the assessee has furnished the inaccurate particulars of income. In our view the penalty in dispute is not sustainable in the eyes of law, because the AO has not recorded any clear finding whether the assessee was guilty of concealment of income or furnishing of inaccurate particulars of income. Secondly, the notice u/s. 271(1)(c) has been issued t ..... 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