TaxTMI 
TaxTMI 
2016 (1) TMI 1324
X X X X Extracts X X X X
X X X X Extracts X X X X
..... 2. That findings of the Tribunal given in quantum of appeal are not binding in penalty appeal. As in penalty bonafides of assessee's conduct is to be verified and not the taxability. 3. That the ld. AO and CIT(A) has not given any independent finding in order u/s. 271(1)(c), of the conclusion that there was a deliberate design on the part of assessee. 4. That ld. AO and CIT(A) wrongly ignored, while imposing the penalty that all the entries of Annexure-I, Annexure-II and Annexure-III, on the basis of which addition in quantum assessment was confirmed are appearing in the statutory records i.e., Gadda Bahi, weekly-returns in Form-M, Ledger, Form-I, and Form-J respectively and accepted by CIT(A) in quantum appeal and shows bonafides of the appellant's conduct. 5. That the ld. AO made many mistakes in calculating additions of Annexure-I and in Annexure-II estimated the bag size=50 kg plus made other mistakes and in Annexure-II he calculated total empty bags = 37367, whereas actual were = 25350, hence all results into estimation for levying penalty. 6. That the ld. AO and ld. CIT(A) wrongly ignored the fact that Sale of Rs. 47,02,3....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ssing Officer has to state clearly as to for which he is initiating penalty proceedings. The learned AR further relied upon the case law K.M. Bhatia (Quarry) v. CIT 193 ITR 379 (Guj). The learned AR further relied upon the following case laws. 1. CIT v. Manjunatha Cotton and Ginning 359 ITR 565 (Karn.) 2. CIT v. Manu Engg. Works 122 ITR 306 (Guj.) 3. New Sorathia Engineering Co. v. CIT: 282 ITR 642 (Guj.) 4. Jayesh R. Kumari v. ITO (ITAT, ASR in ITA 453 In view of the above judgments of various courts, the learned AR submitted that the order of penalty itself is void ab-initio. Since the assessee has raised a legal issue questioning the penalty order itself, therefore, it was decided to first adjudicate ground No. 1 only and therefore, the learned DR was directed to reply to the arguments of learned AR. 4. The learned DR, in response submitted that furnishing of inaccurate particulars of income and concealment of income are one and the same thing and furnishing of inaccurate particulars of income itself amounts to concealment of income and therefore, there is no difference between two. 5. We have heard the rival parties and have gone tho....
X X X X Extracts X X X X
X X X X Extracts X X X X
....eedings under this Act, is satisfied that any person- (a) [***] (b) [***] (c) has concealed the particulars of his income or [***] furnished inaccurate particulars of [such income, or] [(d) has concealed the particulars of the fringe benefits or furnished inaccurate particulars of such fringe benefits," The learned AR has relied upon various case laws to highlight that Assessing Officer is empowered to impose penalty by specifically ..... out the violation of a specific limb which implies that where penalty is initiated on one limb of section the order of penalty cannot be passed on another limb of section. The Hon'ble Karnataka High Court in the case of CIT v. Manjunatha Cotton and Ginning Factory 359 ITR 565 vide para 61 has held as under: "The Assessing Officer is empowered under the Act to initiate penalty proceedings once he is satisfied 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 t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tely for imposition of penalty for the reasons other than which he has issued notice u/s. 274 of the Act. It is evident from the penalty order that the purpose of issuing notice is for concealing the particulars of income and once the satisfaction has been arrived by the AO that the assessee has concealed the particulars of income, he has to proceed in that proposition and the opportunity has been given to the assessee to explain this and the assessee has explained that he has not concealed the particulars of income. If the AO has opted to levy penalty on account of satisfactory explanation offered by the assessee, he is at liberty to do the same. In the present case, purpose of issuing notice u/s. 274 of the Act is for concealing particulars of income and there is no whisper by the AO regarding furnishing of inaccurate particulars of income at the time of issue of notice or at the time of hearing the penalty case before him/Later on, the AO levied penalty for furnishing inaccurate particulars of income and the assessee has not been asked any explanation regarding furnishing of in accurate particulars of income. The charge against the assessee or only concealing the particulars of ....