TaxTMI 
TaxTMI 
2019 (4) TMI 826
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.... of being heard. (iii) In the facts and circumstances, the CIT(A) erred in ignoring the fact that there is no prejudice or violation of principles of natural justice in the case of the assessee and the assesssee was never denied the rights to contest penalty proceedings and had full opportunity to meet the case of Revenue so as to show that the conditions stipulated in section 271 (1)(c) do not exist and that it is not liable to pay penalty. (iv) The CIT(A) ought to have followed the decisions of Hon'ble High Court of Andhra Pradesh in the case of CIT Vs. Chandulal (1 52 ITR 238)(AP) and Srinivasa Pitty & Sons Vs.CIT (173 ITR 306)(AO). (iv) The CIT(A) ought to have held that the case of SSA's Emeralds Meadow Vs. CIT(2016) 73 taxmann.com 248 (SC) is not binding in view of the decision of Shanmugavel Nadar (263 ITR 658)(SC), as the same is merely a dismissal, where it was held that a rejection of SLP through a non-speaking order is not a binding precedent. (vi) The CIT(A) ought to have followed the ratio of Hon'ble Supreme Court's decision in the case of Skylight Hospitality LLP vs. ACIT, dated 06-04-2018 wherein it was held that "W....
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....e Act. As against the order of the ld. CIT(A), the Department carried the matter in appeal before the Tribunal and the ITAT, Visakhapatnam vide its order in ITA Nos.435 to 441/VIZ/2014, dated 09/09/2016, has dismissed the appeal filed by the Revenue. Subsequently, the Assessing Officer has communicated to the assessee regarding penalty proceedings initiated under section 271(1)(c) dated 28/09/2016. In response to the communication, the assessee has requested to drop the penalty. However, the Assessing Officer not accepted the explanation of the assessee and passed the penalty order under section 271(1)(c) of the Act on 31/03/2017 and levied penalty of Rs. 22,68,832/-. The assessee carried the matter in appeal before the ld. CIT(A) and raised an additional ground that non-striking of the irrelevant column, notice makes invalid and for that he relied on the decision of the Hon'ble Jurisdictional High Court in the case of Pr.CIT vs. Smt. Baisetty Revathi in I.T.T.A.No.684/2016, dated 13/07/2017. The ld. CIT(A) admitted the additional ground raised and held that the penalty order dated 31/03/2017 passed under section 271(1)(c) is invalid and consequently penalty of Rs. 22,68,....
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....lment of income or for furnishing of inaccurate particulars. As per the decision of the Hon'ble Jurisdictional High Court cited, for starting the penalty proceedings, the condition precedent is that the assessing officer must be satisfied that a person has either concealed the particulars of his income or furnished inaccurate particulars of such income. The person who is accused of the conditions mentioned in Section 271 should be made aware of the grounds on which imposition of penalty is proposed as he has a right to contest such proceedings and should have the full opportunity to meet the case of the revenue so as to show that the conditions stipulated in Section 271(1)(c) do not exist and that he is not liable to pay the penalty. The Hon'ble High Court of Karnataka in the case law cited held that the practice of the revenue in sending the printed form where all the grounds mentioned in 271(1)(c) are mentioned would not satisfy the requirement of law when the consequence of the assessee not rebutting the initial presumption is serious in nature and has to pay the penalty ranging from 100% to 300% of the tax liability. As the provisions of section 271(1)(c) have to be strictly co....
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....herefore of the opinion that the order under appeal does not brook interference on any ground. We find no question of law, much less a substantial one, arising for consideration warranting admission of this appeal." 6.2. On the similar facts, the Coordinate Bench of ITAT, Visakhapatnam in ITA No.229/Viz/2015 in the case of Narayana Reddy Enterprises, following the order of the Coordinate Bench in the case of Smt. Makina Annapurna Vs. ITO, Visakhapatnam in ITA Nos.604 & 605/Vizag/2014 dated 2.2.2017 held that non-striking of the irrelevant column renders the notice issued u/s 271 as invalid. Respectfully, following the decision of the Hon'ble AP High Court cited supra and the decision of this Tribunal cited (supra), we hold that the notice issued u/s 271 is invalid and consequent penalty imposed by the AO is cancelled. " 10. We find that the ld. CIT(A) by following the decision in the light of Konchada Sreeram (supra) and also the decision in the case of Smt. Baisetty Revathi (supra) has held that the penalty order dated 31/03/2017 passed under section 271(1)(c) is invalid and accordingly penalty levied, is cancelled. For the sake of convenience, the relevant portion of ....