TMI Blog2021 (7) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... alty was initiated. The Hon ble Karnataka High Court in the case of Manjunatha Cotton and Ginning Factory [ 2013 (7) TMI 620 - KARNATAKA HIGH COURT ] has held that while issuing the notice the Assessing Officer has to come to conclusion that whether it is a case of concealment of income or furnishing of inaccurate particulars of income and sending printed forms where all grounds mentioned in section 271 are mentioned, would not satisfy requirement of law. The Hon ble Supreme Court in the case of SSA S Emerald Meadows [ 2016 (8) TMI 1145 - SC ORDER] , has also upheld the finding in the case of Manjunatha Cotton and Ginning Factory (supra) Respectfully, following the decision of the Hon ble Karnataka High Court and Hon ble Supreme Court, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... preciate that the Ld. Assessing Officer has not recorded satisfaction in the Assessment Order as warranted by section 271 of the Income Tax Act, 1961 for initiation of penalty proceedings against the Appellant. As such, in absence of such satisfaction, the subsequent order levying penalty under section 271(l)(c) of the Act is bad in law and thus, may please be quashed. 2. That the Ld. CIT(A) has failed to appreciate that the Id. Assessing Officer had not specified in the notice under section 271(l)(c) r.w.s. 274 of the Act, whether the penalty proceedings were initiated for concealment of income or for furnishing of inaccurate particulars of income. As such, the penalty order under section 271(l)(c) of the Act is bad in law and may pl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 03/2015 under section 144 of the Act, in view of non-filing of vital information called for by the Assessing Officer. The assessee had shown gross turnover of ₹ 45,94,809/- with gross profit rate of 23.11% in terms of section 44AD of the Act and after claiming interest to partners of ₹ 5,53,428/- and remuneration to partners of ₹ 3,94,800/-, declared net profit of ₹ 1,13,847/-. The Assessing Officer examined bank statement of the assessee and noticed that the assessee had deposited cash money of ₹ 79,36,046/- into bank accounts maintained with Canara Bank and ICICI bank . The Assessing Officer disallowed interest and remuneration to the partners. The Assessing Officer estimated net business income of the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or adjudication of these grounds. Accordingly, in view of the settled principal in the case of National Thermal Power Co. Ltd. v. CIT 229 ITR 383 (SC), the additional grounds raised by the assessee are admitted. 5.1 In support of additional ground No.1, the learned Counsel of the assessee submitted that no satisfaction has been recorded for initiating the penalty proceedings by the Assessing Officer and therefore, in view of the decision CIT vs Ram Commercial Enterprises Ltd., (2001) 246 ITR 563 (Delhi High Court), the penalty should be deleted. 5.2 In support of ground No.2, the learned Counsel submitted that while initiating the penalty proceeding relevant charges either of concealment of income or furnishing of inaccurate particula ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urate particulars of income has not been ticked. In such circumstances, the assessee was not clear under which limb of section 271C of the Act, the penalty was initiated. The Hon ble Karnataka High Court in the case of Manjunatha Cotton and Ginning Factory (supra) has held that while issuing the notice the Assessing Officer has to come to conclusion that whether it is a case of concealment of income or furnishing of inaccurate particulars of income and sending printed forms where all grounds mentioned in section 271 are mentioned, would not satisfy requirement of law. The Hon ble Supreme Court in the case of SSA S Emerald Meadows (supra), has also upheld the finding in the case of Manjunatha Cotton and Ginning Factory (supra) 5.6 Respect ..... X X X X Extracts X X X X X X X X Extracts X X X X
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