TMI Blog2019 (1) TMI 1002X X X X Extracts X X X X X X X X Extracts X X X X ..... the said serious infirmity as invalid and void ab initio. - Decided in favour of assessee. - ITA No. 377/Asr./2018 - - - Dated:- 17-1-2019 - Shri N.K. Saini, Vice President And Shri Ravish Sood, Judicial Member For the Appellant : Shri Sandeep Vijh, CA For the Respondent : Sh Shakil Ahmad, D.R ORDER PER RAVISH SOOD, JM The present appeal filed by the assessee is directed against the order passed by the CIT(A)-2, Jalandhar, dated 04.04.2018 which in turn arises from the order passed by the Assessing Officer u/s 271 (1) (c) of the Income Tax Act, 1961 (for short 'I.T. Act'), dated 23.11.2015 for Assessment Year 2009-10. The assessee assailing the order of the CIT(A) has raised before us the following grounds of appeal: 1. The Ld. CIT(A) has erred in sustaining the order u/s 271 (1) (c) which is bad in law. 2. That Ld. CIT(A) has further erred in sustaining an order which was premature and bad in law. The Ld. Assessing Officer had proceeded to levy penalty without even intimating the inability to wait till the decision of the ITAT in quantum appeal. The principles of natural justice thus also stood violated. 3. The Ld. CIT(A) erred i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be imposed, however, did not find favour with him and he imposed a penalty of ₹ 2,75,275/- u/s 271(1)(c) of the I.T. Act for concealing the particulars of income or filing inaccurate particulars of income in the hands of the assessee. 5. Aggrieved, the assessee carried the matter in appeal before the Ld. CIT(A). However, the CIT(A) not finding favour with the contentions advanced by the assessee, dismissed the appeal. 6. The assessee being aggrieved with the order of the CIT(A) had carried the matter in appeal before us. The Ld. Authorized Representative (for short A.R ) of the assessee, at the outset of the hearing of the appeal, submitted that the Assessing Officer had failed to put the assessee to notice as regards the default for which penalty u/s 271(1)(c) was sought to be imposed in the hands of the assessee. In order to drive home his aforesaid contention, the Ld. AR took us through the copy of the Show Cause notice (for short SCN ) dated 7.8.2015, Page 17 of the assessee s Paper Book (in short APB). Apart thereform, it was averred by the Ld. AR that there was no specific mention of the default for which penalty proceedings were initiated by the Assessin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore, the latter had rightly initiated penalty proceedings for both the defaults viz concealment of income and furnishing of inaccurate particulars of income 8. We have heard the authorized representatives for both the parties, perused the orders of the lower authorities and the material available on record. Admittedly, the Assessing Officer in the SCN dated 23.12.2011 had earmarked both the defaults viz concealment of particulars of income or furnishing of inaccurate particulars of income . Interestingly, though the Assessing Officer had ticked both the defaults, however, the usage of the term or used between the said defaults clearly reveals that he had failed to point out the default for which the assessee was called upon to explain as to why penalty u/s 271 (1) (c) may not be imposed upon him. In our considered view, on a bare perusal of the SCN dated 23/12/2011, it can safely be gathered that the Assessing Officer himself was not aware as to for what default the assessee was being put to notice and therein called upon to explain as to why penalty may not be imposed upon him. Apart therefrom, the subsequent opportunity notice issued by the Assessing Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m in the backdrop of the judicial pronouncements on the issue under consideration. Admittedly, the A.O is vested with the powers to levy penalty under Sec. 271(1)(c) of the Act, if in the course of the proceedings he is satisfied that the assessee had either concealed his income or furnished inaccurate particulars of his income . In our considered view, as penalty proceedings are in the nature of quasi criminal proceedings, therefore, the assessee as a matter of a statutory right is supposed to know the exact charge for which he is being called upon to explain that as to why the same may not be imposed. The non specifying of the charge in the Show cause notice not only reflects the non application of mind by the A.O, but the same seriously defeats the very purpose of giving a reasonable opportunity of being heard to the assessee as envisaged under Sec. 274(1) of the I.T Act. We find that the fine distinction between the said two defaults contemplated in Sec. 271(1)(c) viz. concealment of income and furnishing of inaccurate particulars of income had been appreciated at length by the Hon ble Supreme Court in its judgments passed in the case of Dilip Shroff Vs. Jt. CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had been initiated, i.e. whether for concealment of particulars of income or furnishing of inaccurate particulars , the same has to be held as bad in law. The Special Leave Petition (for short SLP ) filed by the revenue against the aforesaid order of the Hon ble High Court of Karnataka had been dismissed by the Hon ble Supreme Court in CIT Vs. SSA s Emerald Meadows (2016) 73 taxmann.com 248 (SC). Apart therefrom, we find that a similar view had been taken by the Hon ble High Court of Bombay in the case of CIT Vs. Samson Perinchery (ITA No. 1154 of 2014; Dt. 05.01.2017)(Bom). 12. We find that as averred by the Ld. A.R., the indispensable obligation on the part of the A.O to clearly put the assessee to notice of the charge under the aforesaid statutory provision viz. Sec. 271(1)(c) had been deliberated upon by a coordinate bench of the Tribunal, i.e. ITAT C Bench, Mumbai in the case of M/s Orbit Enterprises Vs. ITO-15(2)(2), Mumbai (ITA No. 1596 1597/Mum/2014, dated 01.09.2017). The Tribunal in the aforementioned case had in the backdrop of various judicial pronouncements concluded that the failure to specify the charge in the Show cause notice clearly refle ..... X X X X Extracts X X X X X X X X Extracts X X X X
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