9911796707
TMI Blog2021 (9) TMI 82X X X X Extracts X X X X X X X X Extracts X X X X ..... t, is opposed to law, weight of evidence, natural justice, probabilities, facts and circumstances of the Appellant's case. 2. The Appellant denies itself liable to the penalty of Rs. 5,03,278/- levied by the learned assessing officer under section 271(1)(c) of the Act on the facts and circumstances of case. 3. The notice issued under section 271(1)(c) of the Act, is bad in law, on the facts and circumstances of the case. 4. The learned CIT(A) failed to appreciate that the AO has not assumed proper jurisdiction, as the mandatory conditions for invoking the provisions of section 271(1)(c) of the Act has not been complied with under the facts and circumstances of the case. 5. The CIT(A) failed to appreciate that the AO has not reco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 11. Without prejudice to the above, the penalty levied is highly excessive and liable to reduced substantially. 12. The appellant craves leave of this Hon'ble Tribunal, to add, alter, delete, amend or substitute any or all of the above grounds of appeal as may be necessary at the time of hearing. For these and other grounds that may be urged at the time of hearing of appeal, the appellant prays that the appeal may be allowed for the advancement of substantial cause of justice and equity." 2. The assessee in the Return of Income has declared the net taxable income of Rs. 37,35,140/-. The assessee admitted gross total income of Rs. 1,59,68,410/-. After claiming deduction U/s 80IA of the IT Act amounting to Rs. 12233272/- the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in appeal before us. 4. At the outset, the ld. AR argued that the AO in the penalty notice issued u/s. 274 dated 28.3.2013 mentioned as follows:- "have concealed the particulars of your Income or "have furnished inaccurate particulars of such Income." 5. The AO initiated penalty proceedings for levy of penalty for furnishing inaccurate particulars of income. He however levied penalty for concealing the particulars of income which was confirmed by the CIT(Appeals) on the reason of furnishing inaccurate particulars of income. According to the ld. AR, there is variation in initiating the proceedings and levying penalty by the AO and confirmed the levy of penalty by the CIT(Appeals). Hence the penalty has to be deleted on this reason. He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... posing penalty has to be made only on the ground of which the penalty proceedings has been initiated, and it cannot be on a fresh ground of which the assessee has no notice. Therefore, where the Assessing Officer initiated penalty proceedings under section 271(1)(c) for furnishing inaccurate particulars of income, the order imposing penalty for concealment of income was not valid." 7. On the other hand, the ld. DR relied on the order of CIT(Appeals). 8. We have heard both the parties and perused the material on record. Section 271(1)(c) of the Act has two limbs for levy of penalty; (i) concealment of particulars of income; and (ii) furnishing inaccurate particulars of income. Being so, it is incumbent upon the AO to state whether penalt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r furnishing inaccurate particulars of income, however penalty is levied by the AO for concealment of income. Further, the CIT(Appeals) confirmed the penalty on the reason of furnishing inaccurate particulars of income. Being so, there is a defect in issue of notice and levy of penalty by the AO and confirmation of penalty by the CIT(Appeals), which invalidates the levy of penalty u/s. 271(1)(c) of the Act. Accordingly, we quash the penalty order on this ground in this case.
11. Since we have allowed the legal ground of the assessee, we refrain from going into other grounds of appeal raised by the assessee.
12. In the result, the appeal by the assessee is allowed.
Pronounced in the open court on this 31st day of August, 2021. X X X X Extracts X X X X X X X X Extracts X X X X
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