TMI Blog2023 (4) TMI 465X X X X Extracts X X X X X X X X Extracts X X X X ..... ars of income . As in the case of A.M.Shah Company [ 1998 (8) TMI 607 - GUJARAT HIGH COURT] had held that if very basis for penalty proceedings initiated by the AO disappears, then the penalty imposed on a different footing altogether cannot be sustained. Initiating the penalty in one limb and imposing the same on another limb does not satisfy the requirement of the law - The levy of penalty has to be clear as to the limb for which it is imposed and the position in the instant case is unclear, hence, the penalty is not sustainable. Therefore, when the AO proposes to invoke the first limb being concealment, then the notice has to be appropriately marked. Not only that the penalty should be imposed under the same limb. Decided in fav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed). 5. Aggrieved by the order imposing penalty. The assessee filed appeal before the first appellate authority. The ld.CIT(A) rejected the appeal of the assessee, since assessee did not file any written submissions in spite of two e-notices being issued to the assessee. The relevant findings of the ld.CIT(A) reads as follows: During appellate proceedings, two e-notices for providing written submissions were issued to assessee on 18.04.2022 and 23.06.2022 which remained un-complied with till date. Appellant has also not provided the details of expenses pertaining to purchases made of Rs.1,50,000/- which was added u/s. 37 of the Act. Appellant could have availed this opportunity to explain her position during the appellate proceedings ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oid ab intitio deserves to be quashed as no satisfaction was recorded with reference to concealment of income or furnishing inaccurate particulars of income, 4. Unless any positive concealment is found no penalty is leviable on basis of addition made on estimate. 5. The addition to the income of the assessee in this case is based on estimate basis whereas the concealment implies some deliberate act on the part of the assessee in withholding the true facts from the authorities. Therefore, in a case the additions were made on the basis of estimation and as agreed to by the assessee/ the penalty cannot be levied on such additions. 6. Drawing up penalty proceedings for one offence and finding the assessee guilty of another off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rted in 238 ITR 415 (Gujarat). 8. The ld. DR on the other hand supported the orders of the AO and the ld.CIT(A). 9. We have heard the rival submissions and perused the material available on record. The Penalty u /s. 271(1)(c) of the Act can be initiated for i) concealment particulars of income or ii) furnishing inaccurate particulars of such income. Admittedly, in this case penalty proceedings was initiated in the assessment order for the latter limb namely furnishing inaccurate particulars of such income . Further, the notice u/s. 274 r.w.s. 271(1)(c) of the Act ( notice dated 30.12.2019) was issued for furnishing inaccurate particulars of such income . However, we noticed the penalty has been imposed vide order dated 10.02.2022 by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Hon ble Karnataka High Court in the case of CIT vs. Manjunatha Cotton and Ginning Factory reads as follows:- 60. Clause (c) deals with two specific offences, that is to say, concealing particulars of income or furnishing inaccurate particulars of income. No doubt, the facts of some cases may attract both the offences and in some cases there may be overlapping of the two offences but in such cases the initiation of the penalty proceedings also must be for both the offences. But drawing up penalty proceedings for one offence and finding the assessee guilty of another offence or finding him guilty for either the one or the other cannot be sustained in law. It is needless to point out satisfaction of the existence of the grounds mentioned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isfied in the course of any proceedings that there is concealment of income or furnishing of inaccurate particulars of total income under clause (c). Concealment, furnishing inaccurate particulars of income are different. Thus the Assessing Officer while issuing notice has to come to the conclusion that whether is it a case of concealment of income or is it a case of furnishing of inaccurate particulars. The Apex Court in the case of Ashok Pai reported in 292 ITR 11 at page 19 has held that concealment of income and furnishing inaccurate particulars of income carry different connotations. The Gujrat High Court in the case of MANU ENGINEERING reported in 122 ITR 306 and the Delhi High Court in the case of VIRGO MARKETING reported in 171 Taxm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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