TMI Blog2020 (12) TMI 599X X X X Extracts X X X X X X X X Extracts X X X X ..... We direct the Assessing Officer to delete the penalty levied u/s.271(1)(c). - Appeal of the assessee is allowed. - ITA No.58/CTK/2020 - - - Dated:- 14-12-2020 - Shri Chandra Mohan Garg, Judicial Member And Laxmi Prasad Sahu, Accountant Member For the Assessee : Shri P.R.Mohanty, AR For the Revenue : Shri Subhendu Dutta, DR ORDER PER C.M.GARG, JM This is an appeal filed by the assessee against the order of the CIT(A), Sambalpur dated 15.11.2019 for the assessment year 2010-2011. 2. The only issue involved in this appeal is that the ld CIT(A) is not justified in confirming the levy of penalty of ₹ 5,00,000/- under section 271(1)(c) of the Income tax Act, 1961. 3. Facts rise to levy of penalty under se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Ld Counsel for the assessee submitted that in notice u/s 274 r.w.s. 271, the inappropriate words in the said notice have not been struck off. For this, he referred to the notice under section 274 r.w.s 271(1)(c) of the Income tax Act, dated 21.3.2013, wherein, the AO has stated that the assessee have concealed the particulars of income and furnished inaccurate particulars of such income. Therefore, it is not understood as to under which limb of provisions of Section 271(1)(c) of the Act, the Assessing Officer has levied penalty. Since the said show cause notice issued u/s 274 did not specify the charge against the assessee as to whether it was for concealing the particulars of income or for furnishing inaccurate particulars of income, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by ld representatives of both parties. In this case, the Assessing Officer has imposed penalty of ₹ 5,00,000/- after initiating penalty proceedings u/s.271(1)(c) for concealment of income and for furnishing inaccurate particulars of income in respect of the addition made amounting to ₹ 6,00,000/- towards introduction of share capital. The main contention of ld A.R. of the assessee is that the Assessing Officer was not clear under which limbs of provisions, the AO will impose the penalty because in the show cause notice issued u/s.174 of the Act, the AO did not specify the charge against the assessee as to whether it was for concealment of particulars of income or for furnishing inaccurate particulars of income, therefore, in vie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nfined only to those grounds and the said grounds have to be specifically stated so that the assessee would have the opportunity to meet those grounds. After, he places his version and tries to substantiate his claim, if at all, penalty is to be imposed, it should be imposed only on the grounds on which he is called upon to answer. It is not open to the authority, at the time of imposing penalty to impose penalty on the grounds 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 impose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ulars of income or furnishing of inaccurate 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 COMMISSIONER OF INCOME TAX -VS- MANJUNATHA COTTON AND GINNING FACTORY (2013) 359 ITR 565. 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. 12. 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. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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