TaxTMI 
TaxTMI 
2016 (6) TMI 428
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.... return at Rs. 5,11,69,560/- on 31/12/2009 as against Rs. 14,73,790/- shown in the return of income filed of 31/10/2007. The case was scrutinized U/s 143(3) of the Act on 30/09/2009 by the Assessing Officer. The assessment was made at Rs. 5,11,69,560/- in which the addition on account of investment in purchase of agricultural land U/s 69B of the Act was made at Rs. 4,96,75,774/- Penalty U/s 271(1)(c) was initiated for furnishing of wrong particulars and concealment of income vide order dated 30/12/2009 by the ld Assessing Officer. The assessee challenged the order of the Assessing Officer before the ld CIT(A), who vide order dated 08/2/2011 had deleted the addition made by the Assessing Officer at Rs. 39,23,278/- U/s 69B of the Act. Remaining addition was not challenged by the assessee before the ld CIT(A). The revenue in appeal before the Hon'ble ITAT against the CIT(A) order dated 08/2/2011. The Hon'ble ITAT vide order dated 14/12/2011 in ITA No. 406/JP/2011 A.Y. 2007-08 has set aside this issue to the Assessing Officer. Thereafter, the ld Assessing Officer completed the set aside proceeding vide order dated 18/3/2013 wherein he had not made any addition separately but accepted t....
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....ing Officer had been set aside to assess the income of the assessee afresh, as such the assessment as well as the consequent penalty proceeding had no existence until the set aside assessment was completed and income was determined accordingly. Therefore, the ld Assessing Officer had dropped the penalty proceedings for a while on 27/3/2012. This was done within the prescribed time limit as per provisions of Income Tax Act, 1961. Thereafter the set aside assessment had been completed vide order dated 18/3/2013 determining the income of the assessee at Rs. 4,72,86,290/- wherein addition of Rs. 4,57,72,496/- was made U/s 69B of the Act and penalty proceedings U/s 271(1)(c) of the act were initiated and notice in this regard was issued alongwith assessment order dated 18/3/2013. Thus, there is no merit in the assessee's submissions at instant penalty proceeding is bad in law. Further he did not find any merit in the submission that the income had been assessed at the figure offered for taxation by the assessee because as was the matter of fact the assessee had filed its return of income declaring income of Rs. 14,73,790/- on 31/10/2007 and it was the survey operation conducted by the d....
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....t in the case of Dharmendra Textile Processors & ors (2008) 306 ITR 277 (SC) wherein it has been held that penalty proceedings are no longer quasi criminal proceedings and, hence, the presence of mensrea is not required to be established. Therefore, he imposed penalty U/s 271(1)(c) of the Act on concealed income at Rs. 1,54,07,020/-, which is 100% of tax sought to be evaded on income. 3. Being aggrieved by the order of the Assessing Officer, the assessee carried the matter before the ld CIT(A), who had deleted the penalty by observing that the assessee filed revised computation disclosing additional income of Rs. 4,57,72,496/- during the assessment proceedings. The ld Assessing Officer completed assessment on 30/12/2009 U/s 143(3) making addition of Rs. 4,96,95,774/-, which includes the addition of Rs. 39,23,273/- U/s 69B of the Act also. The ld CIT(A) vide order dated 08/2/2011 in ITA No. 834/2009-10 deleted the addition of Rs. 39,23,273/-. The department preferred appeal before the Hon'ble ITAT, the Hon'ble ITAT had set aside this issue to the Assessing Officer. The ld Assessing Officer after ITAT order, had dropped the penalty proceedings vide D&CR No. 87/135 dated 27/03/2012. ....
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....ue is in appeal before us. The ld DR has vehemently supported the order of the Assessing Officer. At the outset, the ld AR of the assessee has reiterated the facts mentioned in the penalty order before the ld CIT(A). In set aside proceedings, the ld Assessing Officer accepted the income offered by the assessee as such at Rs. 4,57,72,496/- by filing the revised computation and also added by the Assessing Officer in the original assessment proceedings remained to the income originally returned by the assessee. In set aside assessment proceedings, the ld Assessing Officer had not specified the addition for which notice U/s 271(1)(c) of the Act was issued nor it was specified whether it is for concealment of income or for furnishing of inaccurate particulars of income. In notice issued on 18/3/2013, the ld Assessing Officer had also not specified the initiation of penalty whether it is for concealed the particulars of income or furnished inaccurate particulars of such income. The order challenged the legality of penalty proceedings initiated in the assessment order passed U/s 143(3)/set aside even then the ld Assessing Officer imposed the penalty on Rs. 4,57,72,496/- on assessed income....
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....er simply issued notice U/s 274 read with Section 271(1)(c) of the Act. Thus, it is not stated as to whether the proceedings are initiated for concealment of income or for furnishing of inaccurate particulars of income without specifying any charge and initiation of penalty proceedings is vague, no penalty can be levied. He relied on the decision in the case of CIT Vs Manjunatha Cotton & Ginning Factory & Ors. 359 ITR 565 (Kar.) wherein notice U/s 274 of the Act should specially stayed the grounds mentioned in Section 271(1)(c) i.e. whether it is for concealment of income or for furnishing inaccurate particulars of income, sending printed form where all the grounds mentioned in Section 271 or mentioned would not specified requirement of law. The assessee should know the ground which he has to meet specifically, otherwise principles of natural justice is offended, on the basis of such proceedings, no penalty could be imposed to the assessee. Taking up of penalty proceedings on one limb and finding the assessee guilty of another limb is bad in law. He further relied on the following case laws:- (i) CIT Vs Manu Engineering Works 122 ITR 306 (Guj)(HC) (ii) CIT Vs Virgo Marketing P....