TMI Blog2019 (5) TMI 1321X X X X Extracts X X X X X X X X Extracts X X X X ..... for statistical purpose. - I.T.A. No.2900/CHNY/2018 - - - Dated:- 22-5-2019 - Shri Inturi Rama Rao, Accountant Member And Shri Duvvuru RL Reddy, Judicial Member For the Appellant : Ms. C. Yamuna, IRS, JCIT. For the Respondent : Shri. Y. Sridhar, C.A. ORDER PER INTURI RAMA RAO, ACCOUNTANT MEMBER This is an appeal filed by the Revenue directed against the order of the learned Commissioner of Income Tax (Appeals)-16, Chennai (hereinafter called as CIT(A) ) dated 10.05.2018 deleting penalty of ₹ 47,21,610/- levied u/s. 271 (1) (c) of the Income Tax Act, 1961 (in short the Act ) for the Assessment year 2014-15. 2. The Revenue r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the Hon'ble Madras High Court in the case of Sundaram Finance Ltd. Vs. ACIT, Company Circle - VI(4), Chennai ( 403 ITR 407). 2.4. The Ld. CIT(A) failed to obverve that after the insertion of the Explanation, it cannot be said that the onus lies on the Revenue to establish mens-rea for concealment of income before imposition of penalty and if there was failure to return the correct income, there would be a presumption of concealment, unless the assessee was able to prove that his failure to return his correct income was not due to fraud or neglect, as observed by the Hon'ble Madras High Court in the case of Pr. CIT-6, Chennai vs. Sundaram Fasteners Ltd. reported in 92 Taxmann.com, 356. 2.5. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessing Officer noticed that Respondent assessee had not returned capital gains arising from sale of land and building at Plot No.386, 30 feet road, Nehru Nagar, Kottivakkam sold for a consideration of ₹ 2,00,00,000/-. When put on notice by the ld. Assessing Officer, it is stated that he had purchased another house property at 73, Annai Indira Nagar, Oggiam Thoraipakkam for a consideration of ₹ 1,55,63,000/- out of sale consideration received on sale of property of original asset. However he failed to substantiate purchase of the property. Then ld. Assessing Officer brought to tax long term capital gains of ₹ 47,21,610/- on the sale of property at Kottivakkam for a consideration of ₹ 2,00,00,000/. Asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing Officer had not struck off the relevant column of the show cause notice. The Bangalore Bench of the Tribunal in the case of P.M.Abdulla vs. ITO (in ITA Nos.1223 1224/Bangalore/2012, dated 17.10.2016) had held that this cannot be a valid reason for deletion of the penalty u/s.271(1) (c) of the Act by holding as under:- 9. We heard rival submissions and perused material on record. The only issue involved is whether levy of penalty u/s.271(1) ( C) is valid in law keeping in view the decision of the Jurisdictional High Court in the case of Manjunatha Cotton Ginning Factory (supra). The contention of the assessee is that since the Assessing Officer had not ticked off the relevant column in the show cause notice, it goes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Jurisdictional High Court had neither considered nor brought to the notice of the Hon ble High Court, provisions of Section 292B of the Act. Even assuming that there is a defect in the show cause notice issued, as canvassed by the learned Counsel for assessee that will vitiate the entire penalty proceedings, the judgment was rendered by the Hon ble High Court in the case of Manjunatha Cotton Ginning Factory (supra) without considering the provisions of Section 292B. Subsequently, the Hon ble Jurisdictional High Court in the case of CIT vs. Sri Durga Enterprises (2014) 44 taxmann.com 442 (Kar) while dealing with the validity of notice u/s.148 of the Act as valid and responded to it in letter and spirit and participated in the proceedings ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... if the notice in `substance' and in `effect' is in conformity with or according to the intent of purpose of this Act. The intent or purpose of issuing the notice is to call upon the assessee to file return, if the Assessing Officer finds that income has escaped the assessment. This being the intent and purpose of the provisions contained in Section 148 of the Act, in our opinion, it stands satisfied if the notice is responded within reasonable time, which in the present case was 30 days, irrespective of the fact whether the period was specified or not in the notice for filing return of income. In the present case, if the assessee had not responded to this notice at all and had raised such ground of challenge, perhaps, he would not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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