TaxTMI 
TaxTMI 
2018 (4) TMI 441
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....of penalty of Rs. 18,00,000/- u/s. 271 (1) (c) of the Act is opposed to law, facts and circumstances of the case. 2. The learned IT(A) ought to have appreciated that there is neither concealment nor furnishing of inaccurate particular income by the appellate assessee and therefore, the penalty u/s 27 1(1) (c) could not have been imposed. 3. The learned CIT(A) ought to have appreciated that the explanation of the appellate assessee was bonafide and therefore, the penalty u/s 271(1) (c) could not have been imposed. 4. The learned CIT(A) ought to have appreciated when there was no seized materials contemplated u/s 132 in the case of the appellate assessee, there could not have been any assessment u/s 153C as per law and therefore, the penalty u/s 27](1) (c) is not justified. 5. The learned CIT (A) ought to have appreciated when the income itself was not liable to be taxed u/s 153C in the absence of seized material, the penalty could not have been imposed. 6 The learned CIT(A) ought to have understood that there was no jurisdiction u/s 153C to justify the penalty u/s 27 1(1) (c). 7. The learned CJT(A) ought to have appreciated that ....
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....enalty u/s 271(1)(c) of the Act, is defective. In this regard the ld AR for the assessee has placed reliance on the decision of the Hon'ble Karnataka High Court in the case of Manjunatha Cotton & Ginning Factory (359 ITR 565) (Kar) and the rejection of the Revenue's SLP by the Hon'ble Apex Court in the case of SSAS Emerald Meadows in SLP: (CC 11485/2016) dated 5/8/2016. The ld AR also placed reliance on the decision of the coordinate bench of this Tribunal in the following cases of - (1) C Ramaiah Reddy in ITA No.977/Bang/2017 dated 22/9/2017 and (ii) Arun Kumar in ITA No.117/Bang/2016 dated 16/12/2106 in support of the assessee's case. It is contended that in similar circumstances, as in the case on hand, the co-ordinate benches of this Tribunal have held that the penalty proceedings initiated on the basis of defective notice has to be cancelled. 3.2 Per contra, the ld DR for Revenue supported the orders of the authorities below. It was submitted that since the ld CIT(A) had not considered and decided the issue of defective notice u/s 274 r.w.s 271 of the Act for initiation of penalty proceedings u/s 271(1)(c) of the Act, therefore the matter requires to be sent back to the ....
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....e existence of the conditions could not be discerned from the said order and if it is a case of relying on deeming provision contained in Explanation-I or in Explanation- l(B), then though penalty proceedings are in the nature of civil liability, in fact, it is' penal in nature. in either event, the person who is accused Of the conditions mentioned in Section 271 should be made known about the grounds on which they intend imposing penalty oil as the Section 274 makes it clear that assessee has a right to contest such proceedings and should have full opportunity to meet the case of the Department and show that the conditions stipulated in Section 271(I)(c) c/a not exist as such he is not liable to pay penalty. The practice of the Department sending a printed farm where all the ground mentioned in Section 271 are mentioned would not satisfy requirement of law when the consequences of the assessee not rebutting the initial presumption is serious in nature and he had to pay penalty from 100% to 300% of tax liability. As the said provisions have to be held to be standby construed notice issued under Section 274 should satisfy the grounds which he has to meet specifically. Otherwise,....
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....ccurate particulars of total income under clause (c). Concealment, furnishing inaccurate particulars of income are different. Thus the Assessing Officer while issuing notice has to come to the conclusion that whether is it a case of concealment of income or is it a case of furnishing of inaccurate particulars. The Apex Court in the case of Ashok Pai reported in 292 ITR 11 at page 19 has held that concealment of income and furnishing inaccurate particulars of income carry different connotations. The Gujarat High Court in the case of M4NU ENGINEERING reported in 122 ITR 306 and the Delhi High Court in the case of VIRGO IvL4RKETING reported in 171 Taxman 156, has held that penalty has to be clear as to the limb for which it is levied and the action being unclear penalty is not sustainable. Therefore, when the Assessing Officer proposes to invoke the first limb being concealment, then the notice has to be appropriately marked. Similar is the case for furnishing inaccurate particulars of income. The standard proforma without striking of. the relevant1 clauses will lead to an inference as to non-application of mind." 3.3.3 The aforesaid view taken by the Hon'ble Karnataka High Court i....