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TMI Blog2023 (5) TMI 681X X X X Extracts X X X X X X X X Extracts X X X X ..... e either for concealment of particulars of income or for furnishing of inaccurate particulars of such income and consequently the imposition of impugned penalty for both limbs by Ld. A.O. tantamounts to violation of statutory provisions of section 271 (1 )(c) of I.T. Act. 4. That the Ld. CIT(A) also erred in law in ignoring the fundamental error in impugned assessment order and penalty notice, having no indication as to for which limb, the penalty proceedings are proposed to be initiated. 5. That the Ld. CIT(A) also erred in law, on facts and in surrounding circumstances in failing to consider the issue of condonation of delay with empathically pragmatically, resulting in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. 6. That the Ld. CIT(A) also erred in law in failing to provide adequate opportunity of hearing coupled with opportunity of explaining the so called minor defects so cited in impugned appellate order. 7. That the Ld. CIT(A) also erred in failing to appreciate that mere issuance of notices, without ensuring valid service as per law is nothing but an exercise in futility having no legal sanctity. 8. That wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax Officer, Ward-1(4), Ghaziabad on 25/01/2018. There is no material on record to show that the penalty order has been served on the assessee prior to the said date i.e. 25/01/2018. In the absence of the same, the Ld. CIT(A) ought to have accepted the contention of the assessee and by condoning the delay in filing the appeal and should have decided the appeal on merit. Therefore, we inclined to condone the delay in filing the appeal before the CIT(A). 8. In so far as merit of the case is concerned, the Ld. Counsel for the assessee vehemently submitted that the penalty notice has been passed u/s 274 of the Act without any specific charge, hence notice issued u/s 274 of the Act and the order passed u/s 271(1)(c) of the Act are illegal and bad in law and without jurisdiction. The Ld. Counsel for the assessee has also relied on various judicial pronouncements in support of his case. 9. Per contra, the Ld. DR submitted that the assessee did not comply the notices issued u/s 271(1) (c) of the Act and the assessee had concealed the particular of his true income therefore, has the penalty has been rightly imposed against the assessee. Further submitted that mere non mentioning of specifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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'sfavour. 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 Kaushaiya does not lay down the correct proposition of law. Question No.2: Has Kaushaiya failed to discuss the aspect of 'prejudice? 184. Indeed, Kaushaiya did discuss the aspect of prejudice. As we I.T.A.No.1409/Del/2016 have already noted, Kaushaiya noted that the assessment orders already contained the reasons why penalty should be initiated. So, the 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctice certainly betrays nonappiication of mind. And, therefore, the infraction of a mandatory procedure leading to penai consequences assumes or implies prejudice. 189. In Sudhir Kumar Singh, the Supreme Court has encapsulated the principles of prejudice. One of the principles is that "where procedural and/or substantive provisions of law embody the principles of natural justice, their infraction per se does not lead to invalidity of the orders passed. Here again, prejudice must be caused to the litigant, "except in the case of a mandatory provision of law which is conceived not only in individual interest but also in the public interest". 190. Here, section 271(l)(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, althoug ..... X X X X Extracts X X X X X X X X Extracts X X X X
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