2018 (9) TMI 1

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....06,2006-07,2007-08 and 2009-10. The proceeding for imposition of penalty arose out of an order of best judgement assessment made by the assessing officer pertaining to the aforesaid five assessment years. The assessing officer had found that the assessee had not disclosed a bank account which was operated by him in his return of income. For this reason, the assessing officer had added the deposits made in that bank account to the total income of the assessee. Mr. Chowdhury, learned Counsel for the Revenue submits that there was a live bank account, which reflected several withdrawals and utilisation of the withdrawn sums by the assessee. Ultimately, the deposits to that bank account was added to the income of the assessee and tax charged....

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....on in the show cause notice and therefore the show cause notice does not specify the charge against the assessee as to whether the charge is of concealment of particulars of income or furnishing of inaccurate particulars of income. 10. The ld. Counsel for the assessee drew our attention to the decision of the Hon'ble Karnataka High Court in the case of CIT vs. SSA's Emerald Meadows in ITA No.380 of 2015 dated 23.11.2015 wherein the Hon'ble Karnataka High Court following its own decision in the case of CIT vs Manjunatha Cotton and Ginning factory (2013) 359 ITR 565 took a view that imposing of penalty u/s. 271(1)(c) of the Act is bad in law and invalid for the reason that the show cause notice u/s 274 of the Act does not specify the....

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....out the inappropriate words. In these circumstances, we are of the view that imposition of penalty cannot be sustained. The plea of the ld. Counsel for the assessee which is based on the decisions referred to in the earlier part of this order has to be accepted. We therefore hold that imposition of penalty in the present case cannot be sustained and the same is directed to be cancelled. " Mr. Chowdhury in course of argument has urged us to remand the matter before the assessing officer. According to him, this was a technical flaw, which the Revenue must be given a chance to cure. The reason why the penalty order was not sustained by the Tribunal appears from the passages of the decision of the Tribunal quoted earlier in this jud....