TMI Blog2020 (4) TMI 587X X X X Extracts X X X X X X X X Extracts X X X X ..... Assessing Officer to delete the penalty in question. See M/S MANJUNATHA COTTON AND GINNING FACTORY OTHS., M/S. V.S. LAD SONS, [ 2013 (7) TMI 620 - KARNATAKA HIGH COURT] and M/S SSA'S EMERALD MEADOWS [ 2016 (8) TMI 1145 - SC ORDER]. AO to assume jurisdiction u/s 271(1)(c), proper notice is necessary and the defect in notice u/s 274 of the Act vitiates the assumption of jurisdiction by the learned Assessing Officer to levy any penalty. In this case, facts stated supra, clearly establish that the notice issued under section 274 read with 271 of the Act is defective - Decided in favour of assessee. - I.T.A. No. 4506/Del/2016 - - - Dated:- 11-2-2020 - Shri Prashant Maharishi, Accountant Member And Shri K. Narasimha Chary, Judici ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such penalty, assessee preferred appeal before the Ld. CIT(A) and contended that no penalty was warranted as the assessee made a claim under a bona fide belief and all the relevant facts were disclosed in ITR and financial statements of the assessee company. CIT(A), however, did not accept such an explanation on the ground that the income tax returns of large corporate assessees are invariably filed with the active professional assistance and advice of tax experts and had the return of income filed by the assessee not taken for scrutiny, the ineligible claim would have escaped the assessment. On this premise, Ld. CIT(A) dismissed the appeal of the assessee. Assessee is, therefore, before us in this appeal. 4. Ld. AR submitted that in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee. He therefore, prayed to dismiss the appeal. 6. We have gone through the record in the light of the submissions made on either side. It could be seen from the assessment order that the learned Assessing Officer proposed the proceedings under section 271(1)(c) of the Act for concealing the particulars of income and furnishing of inaccurate particulars thereof. When it came to the notice issued under section 274 read with section 271 of the Act, such a notice does not specify whether it is for concealment of income or for furnishing of inaccurate particulars thereof, against which the assessee had to defend itself. Order under section 271(1)(c) of the Act narrates that the penalty was leviable under section 271(1)( c ) of the Act for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other than what assessee was called upon to meet. Otherwise though the initiation of penalty proceedings may be valid and legal, the final order imposing penalty would offend principles of natural justice and cannot be sustained. Thus once the proceedings are initiated on one ground, the penalty should also be imposed on the same ground. Where the basis of the initiation of penalty proceedings is not identical with the ground on which the penalty was imposed, the imposition of penalty is not valid. The validity of the order of penalty must be determined with reference to the information, facts and materials in the hands of the authority imposing the penalty at the time the order was passed and further discovery of facts subsequent to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , we are of the opinion, no substantial question of law arises in this appeal for determination by this Court. The appeal is accordingly dismissed. 10. The Special Leave Petition filed by the Revenue challenging the aforesaid judgement of the High Court was dismissed by the Hon ble Supreme Court holding: We do not find any merit in this petition. The special leave petition is, accordingly, dismissed. 11. In PCIT vs. Sahara India Life Insurance Company Limited case ITA No 475/2019 and batch order dated 02/08/2019, Hon ble Delhi High Court, upheld the view taken by the Tribunal basing on the decision of the Hon ble Karnataka High Court in the case of Manjunatha Cotton and Ginning Factory (supra) and SSA s Emerald Meadows (supra ..... X X X X Extracts X X X X X X X X Extracts X X X X
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