TMI Blog2022 (9) TMI 1499X X X X Extracts X X X X X X X X Extracts X X X X ..... income OR furnished inaccurate particulars of such income, but thereafter imposed the same vide his order passed u/s. 271(1)(c) of the Act, dated nil for both the defaults i.e. concealment of income and furnishing of inaccurate particulars of income, therefore, on the said count too the impugned penalty could not be sustained and is liable to be struck down. We, thus, for the aforesaid reasons not being able to persuade ourselves to subscribe to the imposition of penalty by the A.O, therefore, set-aside the order of the CIT(A) who had not only upheld but in fact enhanced the same. Accordingly, the penalty imposed under Sec. 271(1)(c) - Decided in favour of assessee. - Shri Ravish Sood, Judicial Member And Shri Arun Khodpia, Accountant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in confirming penalty levied by ld. Assessing Officer under section 271(1)(c) of the Income-tax Act, 1961 on the basis of Show Cause Notice issued under section 274 r.w.s. 271(1)(c) without ascertaining and mentioning the specific charge of default hence the penalty order is bad in law and void ab initio. 2. In the facts and circumstances of the case and in law, the impugned order is illegal and unsustainable as per law laid down in the case of CIT V/ s SSA's Emerald Meadows (73 Taxmann.com 248 SLP dismissed on 05/08/2016). As the assessee by raising the aforesaid additional grounds of appeal sought our indulgence for adjudicating a legal issue which requires looking for facts beyond those available on record, therefore, we a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the assessee s claim of excess deduction u/s. 36(1)(viii) Rs.57,645/- 2. Disallowance of the assessee s claim of legal expenses Rs.40,000/- 5. Aggrieved, the assessee assailed the order passed by the A.O u/s. 271(1)(c) of the Act before the CIT(Appeals), who not only confirmed the penalty imposed by the A.O, but also considering the fact that the assessee s claim for deduction u/s. 36(1)(viii) while disposing off the assessee s quantum appeal declined by him a/w. enhancement of the disallowance of the assessee s claim for deduction of legal expenses as was made by the AO, the CIT(Appeals) enhanced the penalty by an amount of Rs.3,15,850/-.Accordingly, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was duly fortified. Apart from that the Ld. AR took us through the assessment order which as pointed out by him revealed that the penalty proceedings were initiated by the A.O for both the two grounds, viz. (i) claim of deduction u/s. 36(1)(viia) of the Act; and (ii) claim of legal expenses; for concealment of its income OR furnishing of inaccurate particulars of income. It was submitted by the Ld. AR that even otherwise, in the penalty order passed by the A.O u/s. 271(1)(c) dated Nil, the impugned penalty had been imposed by the A.O for furnishing of inaccurate particulars of income AND concealment of income. On the basis of his aforesaid contentions, it was submitted by the Ld. AR that as the A.O had failed to validly put the assessee to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... initiated by him. Be that as it may, we find that though the AO while framing the assessment vide his order passed u/s. 143(3)/148 of the Act, dated 26.12.2013, had initiated penalty proceedings u/s. 271(1)(c) alleging that the assessee had concealed its income OR furnished inaccurate particulars of such income, however, the same, thereafter, was imposed by him vide his order passed u/s. 271(1)(c) of the Act, dated nil for both the defaults i.e. concealment of income and furnishing of inaccurate particulars of income. In our considered view as both the defaults i.e., concealment of income and furnishing of inaccurate particulars of income are separate and distinct defaults which operate in their exclusive fields, therefore, imposition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e particulars of income, therefore, on the said count too the impugned penalty could not be sustained and is liable to be struck down. We, thus, for the aforesaid reasons not being able to persuade ourselves to subscribe to the imposition of penalty by the A.O, therefore, set-aside the order of the CIT(A) who had not only upheld but in fact enhanced the same. Accordingly, the penalty of Rs.5,15,850/-imposed under Sec. 271(1)(c) by the A.O, which thereafter was enhanced by the CIT(Appeals) is quashed in terms of our aforesaid observations. 12. In the result, the appeal of the assessee in ITA No.118/RPR/2017 for the assessment year 2010-11 is allowed in terms of our aforesaid observations. ITA No.116/RPR/2017 A.Y.2008-09 13. A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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