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TMI Blog2019 (2) TMI 156X X X X Extracts X X X X X X X X Extracts X X X X ..... nsel for the assessees submitted that the penalty levied u/s.271(1) (c) of the Act could not be sustained since notice issued to the assessee u/s. 274 r.w.s. 271 of the Act was vague. According to him, notice u/s.274 r.w.s. 271 of the Act for the impugned assessment years, did not specify the reason why penalty proceedings were initiated. As per the ld. Authorised Representative, notice did not say whether assessees had concealed particulars of income or had furnished any inaccurate particulars of income. Contention of the ld. Authorised Representative, was that a notice which did not show the default which assessee the was required to explain, was an invalid one. Reliance was placed on the judgments of Hon'ble Karnataka High Court in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he root of the jurisdiction to levy a penalty under Section 271 (1) (c) of the Act and can therefore be considered at any stage of the appellate proceedings. Notice issued to the assessee under these Sections, for all the years are typically worded for both the assessees and that for assessment year 2006-07, in the case of R. Pannerselvam (HUF) is reproduced hereunder:- NOTICE UNDER SECTION 274 READ WITH SECTION 271 OF THE INCOMETAX ACT, 1961 (Notice u/s 271(1)(c) PAN AAAHR 0200H Office of the Assistant Commissioner of Income Tax, Circle II, Chennai 600 034. Dated 30.12.2011. To R. Pannerselvam (HUF) No.43, Rohini Vasantham, Sarangapani Street, T. Nagar, Chennai 600 017. Whereas in the course of proceedings before me for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng of inaccurate particulars of income. However, a reading of the above notice clearly show that the word used for linking the two portions is ''or ''and not ''and''. An assessee in our opinion has every right to know which alleged default he has to explain. If it is both, it is necessary to mention so, in the notice. Without knowing what is default for which he is being charged, an assessee cannot give explanation. In a similar situation Hon'ble Karnataka High Court in the case of SSA's Emerald Meadows (supra), relying on its own judgment in the case of Manjunatha Cotton and Ginning Factory (supra) held as under at para 2 to 4 of its judgment. '2. This appeal has been filed raising the following substantial questions of law: (1) Whether ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... curate 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 CIT 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''. In the earlier case of Manjunatha Cotton and Ginning Factory (supra) their lordship had observed as under:- ''Notice under section 274 of the Act should specifically state the grounds mentioned in section 271(1)(c) , i.e., whether it is for concealment of income or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the petition filed by the Revenue. We further find that the Hon'ble Jurisdictional High Court in the case of Original Kerala Jewellers (surpa) had held as under:- ''3. The Tribunal by the impugned order set aside the penalty imposed on the assessee on the ground that the notice issued to the assessee at the very commencement of the penalty proceedings is vitiated and not sustainable in the eye of law. 4. The Tribunal referred to and relied upon the decision of the Divison Bench of the High Court of Karnataka in CIT v. Manjunatha Cotton and Ginnng Factory [reported in (2013) 359 ITR 565]. The Division Bench after analyzing the subject in an elaborate manner and relating to several decisions of the Hon'ble Supreme Court held that merely b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s passed on 21.11.2016 without giving sufficient time to the assessees for giving a reply to the notice. According to him, there were errors in computing interest u/s.234A of the Act, which could not be explained by the assessee due to lack of proper opportunity. 7. Per contra, ld. Departmental Representative strongly supported the orders of the authorities below. 8. We have considered the rival contentions and perused the orders of the authorities below. It is an admitted position that show cause notice u/s.154 of the Act was served on the assessees on 10.11.2016 and the order u/s.154 of the Act was passed on 21.11.2016. There was hardly 11 days between date of receipt of show cause notice and the date of issue of order. We therefore fin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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