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TMI Blog2022 (12) TMI 794X X X X Extracts X X X X X X X X Extracts X X X X ..... ax, Appeals (CIT-A) has without going into the facts of the case has sustained penalty u/s 271(1)(c) of the Act amounting to Rs. 88,000,00/- 2. The CIT-A) did not appreciate the contention of the appellant while sustaining penalty and missed to note that disallowance of an expense per se cannot mean that the assessee has furnished inaccurate particulars of its income and as such do not call for penal action. 3. The Ld. CIT-A) missed to note that the legitimate claim of the assessee was disallowed u/s 40A(3) of the Act. 4. The Ld. CIT-A) has sustained penalty contrary to facts and against law. 5. That the impugned order is bad in law and not in consonance with facts, and against the principles of natural justice." 3. None appeared f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eanings. Therefore, it is imperative for the A.O. to specify the relevant and exact limb so as to make the assessee aware as to what is the charge made against him so that he can respond adequately. 8. Hon'ble Bombay High Court (full bench at Goa) in the case of Mr. Mohd. Farhan A. Shaikh vs. ACIT [434 ITR (1)] and the Hon'ble High Court held as under:- "Question No. l: If the assessment order clearly records satisfaction for imposing penalty on one or the other, or both grounds mentioned in Section 271(1)(c), does a mere defect in the notice--not striking off the irrelevant matter--vitiate the penalty proceedings? 181. It does. The primary burden ties on the Revenue. In the assessment proceedings, it forms an opinion, prima fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee, stresses Kaushaiya, "fully knew in detail the exact charge of the Revenue against him". For Kaushaiya, the statutory notice suffered from neither nonapplication of mind nor any prejudice. According to it, "the so-called ambiguous wording in the notice [has not] impaired or prejudiced the right of the assessee to a reasonable opportunity of being heard". It went onto observe that for sustaining the piea of natural justice on the ground of absence of opportunity, "it has to be established that prejudice is caused to the concerned person by the procedure followed". Kaushalya doses the discussion by observing that the notice issuing "is an administrative device for informing the assessee about the proposal to levy penalty in order to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inaccurate particulars. 188. We may, in this context, respectfully observe that a contravention of a mandatory condition or requirement for a communication to be valid communication is fatal, with no further proof. That said, even if the notice contains no caveat that the inapplicable portion be deleted, it is in the interest of fairness and justice that the notice must be precise. It should give no room for I.T.A.No.1409/Del/2016 ambiguity. Therefore, Dilip N. Shroff disapproves of the routine, ritualistic practice of issuing omnibus show-cause notices. That practice certainly betrays nonappiication of mind. And, therefore, the infraction of a mandatory procedure leading to penai consequences assumes or implies prejudice. 189. In Sudh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he inapplicable parts of that generic notice. Conclusion: We have, thus, answered the reference as required by us; so we direct the Registry to place these two Tax Appeals before the Division Bench concerned for further adjudication." 9. As could be seen from the above the Hon'ble Bombay High Court (Full Bench at Goa) in the case of Mr. Mohd. Farhan A. Shaikh v. ACIT [(2021) 434 ITR 1 (Bom)] while dealing with the issue of non-strike off of the irrelevant part in the notice issued u/s.271(1)(c) of the Act, held that assessee must be informed of the grounds of the penalty proceedings only through statutory notice and an omnibus notice suffers from the vice of vagueness. 10. Ratio of this full bench decision of the Hon'ble Bombay Hi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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