TMI Blog2020 (9) TMI 23X X X X Extracts X X X X X X X X Extracts X X X X ..... ave to be held as invalid and consequently penalty imposed is cancelled. - Decided in favour of assessee. - ITA Nos. 1367 & 1368/KOL/2019 - - - Dated:- 17-7-2020 - SH. S. S. GODARA, JUDICIAL MEMBER AND DR. A. L. SAINI, ACCOUNTANT MEMBER Appellant by : Sh. Miraj D. Shah, AR Respondent by : Sh. Jayanta Khanra, JCIT ORDER PER SH. S.S. GODARA, JUDICIAL MEMBER These two assessee s appeals for AY 2013-14 2014-15 arise against the Commissioner of Income Tax (Appeals)-11 Kolkata s orders; both dated 15.02.2019 passed in ITA. No. CIT(A)-11/KOL/10149/18-19 upholding Assessing Officer s action imposing penalty(ies) of ₹13,22,780/- ₹1,42,128/- (assessment year-wise); respectively in proceedings u/s 271(1)(c) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld that notice u/s. 274 of the Act should specifically state as to whether penalty is being proposed to be imposed for concealment of particulars of income or for furnishing inaccurate particulars of income. The Hon ble High court has further laid down that certain printed form where all the grounds given in section 271 are given would not satisfy the requirement of law. The Court has also held that initiating penalty proceedings on one limb and find the assessee guilty in another limb is bad in law. It was submitted that in the present case, the aforesaid decision will squarely apply and all the orders imposing penalty have to be held as bad in law and liable to be quashed. 9.2. The Hon ble Karnataka High Court in the case of CIT A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d would not satisfy requirement of law when the consequences of the assessee not rebutting the initial presumption is serious in nature and he had to pay penalty from 100% to 300% of the tax liability. As the said provisions have to be held to be strictly construed, notice issued under Section 274 should satisfy the grounds which he has to meet specifically. Otherwise, principles of natural justice is offended if the show cause notice is vague. On the basis of such proceedings, no penalty could be imposed on the assessee. 60. Clause (c) deals with two specific offences, that is to say, concealing particulars of income or furnishing inaccurate particulars of income. No doubt, the facts of some cases may attract both the offences and in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enalty 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 the imposition of penalty cannot validate the order of penalty which, when passed, was not sustainable. 61. The Assessing Officer is empowered under the Act to initiate penalty proceedings once he is satisfied in the course of any proceedings that there is concealment of income or furnishing of inaccurate particulars of total income under clause (c). Concealment, furnishing inaccurate particulars of income are different. Thus the Assessing Officer while issuing notice has to come to the conclusion that whether is it a case of co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iscernible from the Assessment Order or order of the Appellate Authority or Revisional Authority. f) Even if there is no specific finding regarding the existence of the conditions mentioned in Section 271(1)(c), at least the facts set out in Explanation 1(A) (B) it should be discernible from the said order which would by a legal fiction constitute concealment because of deeming provision. g) Even if these conditions do not exist in the assessment order passed, at least, a direction to initiate proceedings under Section 271(l)(c) is a sine qua non for the Assessment Officer to initiate the proceedings because of the deeming provision contained in Section 1(B). h) The said deeming provisions are not applicable to the order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal, if the appellate authority records satisfaction, then the penalty proceedings have to be initiated by the appellate authority and not the Assessing Authority. p) 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 for furnishing of incorrect particulars of income q) Sending printed form where all the ground mentioned in Section 271 are mentioned would not satisfy requirement of law. r) The assessee should know the grounds which he has to meet specifically. Otherwise, principles of natural justice is offended. On the basis of such proceedings, no penalty could be imposed to the assessee. s) Taking up of pena ..... X X X X Extracts X X X X X X X X Extracts X X X X
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