TMI Blog2021 (11) TMI 965X X X X Extracts X X X X X X X X Extracts X X X X ..... tice was issued. Case of MR. MOHD. FARHAN A. SHAIKH [ 2021 (3) TMI 608 - BOMBAY HIGH COURT] squarely applies to the facts of the assessee s case as the notice u/s. 274 r.w.s. 271(1)(c) of the Act was issued mechanically in a printed format without striking off the irrelevant portion of the limb and failed to intimate the assessee the relevant limb and charge for which the notice was issued. Thus, respectfully following the said decision we hold that the penalty order passed u/s. 271(1)(c) of the Act by the Assessing Officer is bad in law and accordingly the penalty order passed u/s. 271(1)(c) of the Act is quashed - Decided in favour of assessee. - ITA No. 6536/MUM/2019 - - - Dated:- 25-6-2021 - Shri C.N. Prasad, Hon'ble Judici ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proceedings only through statutory notice and an omnibus notice suffers from the vice of vagueness. Therefore, it is submitted that since the notice issued u/s. 274 r.w.s. 271(1)(c) of the Act did not specify the limb for which or the charge for which it was issued the penalty order passed pursuant to such notice is bad in law. It is submitted that the Full Bench decision of the Hon'ble Jurisdictional High Court squarely applies to the facts of the assessee s case. 4. Ld. DR vehemently supported the orders of the authorities below. 5. We have heard the rival submissions, perused the orders of the authorities below and the decision of the Hon'ble Jurisdictional High Court in the case of Mr. Mohd. Farhan A. Shaikh v. ACIT (s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oceedings culminate under a different statutory scheme that remains distinct from the assessment proceedings. Therefore, the assessee must be informed of the grounds of the penalty proceedings only through statutory notice. An omnibus notice suffers from the vice of vagueness. 182. More particularly, a penal provision, even with civil consequences, must be construed strictly. And ambiguity, if any, must be resolved in the affected assessee s favour. 183. Therefore, we answer the first question to the effect that Goa Dourado Promotions and other cases have adopted an approach more in consonance with the statutory scheme. That means we must hold that Kaushalya does not lay down the correct proposition of law. Question No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regarding the other assessment year, it reasons that the assessment order, containing the reasons or justification, avoids prejudice to the assessee. That is where, we reckon, the reasoning suffers. Kaushalya s insistence that the previous proceedings supply justification and cure the defect in penalty proceedings has not met our acceptance. Question No.3: What is the effect of the Supreme Court s decision in Dilip N. Shroff on the issue of non-application of mind when the irrelevant portions of the printed notices are not struck off ? 187. In Dilip N. Shroff, for the Supreme Court, it is of some significance that in the standard Pro-forma used by the assessing officer in issuing a notice despite the fact that the same postu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 190. Here, section 271(1)(c) is one such provision. With calamitous, albeit commercial, consequences, the provision is mandatory and brooks no trifling with or dilution. For a further precedential prop, we may refer to Rajesh Kumar v. CIT[74], in which the Apex Court has quoted with approval its earlier judgment in State of Orissa v. Dr. Binapani Dei[ 75]. According to it, when by reason of action on the part of a statutory authority, civil or evil consequences ensue, principles of natural justice must be followed. In such an event, although no express provision is laid down on this behalf, compliance with principles of natural justice would be implicit. If a statue contravenes the principles of natural justice, it may also be held ult ..... X X X X Extracts X X X X X X X X Extracts X X X X
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