2018 (2) TMI 1543

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....Act. Since the facts are identical and the issue involved is common in these appeals, they are clubbed, heard together and disposed of by this common order for the sake of convenience. The facts are extracted from WTA 23/Viz/2017 for the A.Y.2008-09. 2. In these appeals, wealth tax assessments were completed on net wealth of Rs. 3,49,73,040/-. The assessee has taken loan of Rs. 5,09,00,000/- for purchase of the asset from his wife and claimed the deduction from the value of the asset. Since both the assessee and the creditor are not residents, the AO relied on Circular No. 392[F.No.321/78/75-WT], dated 24.08.1984 and recomputed the net wealth rejecting the assessee's claim for deduction of loan taken from his wife amounting to Rs. 5,09,0....

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....quent assessment years, the assessee had admitted the same value of Rs. 4,35,60,000/- which was accepted by the department, hence argued that there is no case for penalty and the penalty imposed by the CWT(A) required to be cancelled. In the second proposition, the Ld.AR submitted that the Ld.CWT(A) has issued show notice u/s 18(1)(c), without striking the irrelevant column in the notice with regard to furnishing of inaccurate particulars or concealment of income. The Ld.AR submitted that the Ld.CWT(A) has issued notice u/s 18(1)(c) calling for the assessee's explanation stating that 'the assessee had concealed particulars of net wealth, furnished inaccurate particulars' but not made known the exact reason for initiating the penalty u/s 18(....

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....th, furnished inaccurate particulars' of such net wealth". In the appellate order the Ld.CWT(A) initiated penalty stating as under: "Penalty proceedings u/s 18(1)(c) of the WT act are initiated separately." 5.1. In para No.No.3.1 of the penalty order the Ld CWT(A) stated that the penalty was initiated for furnishing of inaccurate particulars of net wealth. Though from the penalty order it revealed that the CWT(A) has initiated the penalty u/s 18(1)(c) for furnishing of inaccurate particulars of net wealth, but both the CWT(A) order as well as the show cause notice does not indicate for which offence the penalty was initiated, whether for inaccurate particulars or concealment of income. Though the CWT(A) has issued the show cause no....

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....nalty notice issued u/s 271 of the Act and the assessment order and it was noticed that the A.O. has not struck off the irrelevant column or made known to the assessee by mentioning for which offence, the penalty was initiated. As per the settled case laws, the A.O. has to made known the assessee for which reason the penalty was initiated and for which limb of the notice, explanation required to be submitted. Hon'ble jurisdictional High Court in the case of Principal CIT Visakhapatnam Vs. Baisetty Revati in I.T.T.A No.684 of 2016 dated 13.7.2017 held that the A.O. required to made known the specific ground for which the penalty has been initiated. For ready reference, we reproduce the relevant paragraph of the the Hon'ble High Court order m....