2017 (4) TMI 1393

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....) ( c) of the Income Tax Act, 1961 (Act). 3. The facts and circumstances under which penalty u/s.271(1) ( c) of the Act was imposed on the Assessee by the AO, are as follows: The Assessee is a partnership firm engaged in the business of growing and manufacturing of tea. In terms of Rule 8(1) of Income Tax Rules, 1962 (Rules) income from growing and manufacturing of tea has to be computed as if it was derived from business and 40% of such income alone is liable to tax under the Income Tax Act, 1961 (Act.). If the tea is manufactured with tea leaves not grown by the assessee then that income will not be the subject matter of Rule 8(1) of the Rules as tea is not grown and manufactured by the assessee but manufactured from tea leaves purc....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....uilty of having concealed particulars of income or having furnished inaccurate particulars of income. Copies of the show cause notices u/s 274 of the Act are placed at page-1 to 7 of the assessee's paper book and perusal of the same reveal that AO has not struck out the irrelevant portion in the show cause notices and therefore the show cause notices do 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". 6. 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 Hig....