2019 (4) TMI 1163

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....nst the Appellate Order passed, under s. 250 of the income Tax Act, 1961, by the learned Commissioner of Income-Tax (Appeals)-III, Indore, pertaining to the A.Y. 2013-14 in response to the appeal filed against the Penalty Order under s. 271AAB of the Act, passed by the learned Assistant Commissioner of Income- Tax (Central)-2, Indore. 1.That, the learned CIT (A) grossly erred in law in confirming the penalty of Rs. 3,50,000/- out of total penalty of Rs. 7,00,000/- imposed by the Assessing Officer under s.271AAB of the Income-Tax Act, 1961 without considering and appreciating the material fact that the AO imposed the penalty without issuing a proper show-cause notice as contemplated under the provisions of section 274 of the Income-....

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..... The assessee is in present appeal against the order of the Ld. CIT(A). At the outset, Ld. counsel for the assessee submitted that initiation of penalty u/s 271AAB of the is ex facie bad in law. He drew our attention towards the notice dated 05.08.2015 and enclosed at page no.25 of the paper book. He submitted that the AO initiated penalty proceedings in a casual mechanical manner. That goes to demonstrate that assessing officer has not made a specific charge. Further Ld. counsel for the assessee relied upon the various case laws more particularly in the case of Sandeep Chandak, vs. ACIT in ITANos.416,417 and 418/Lkw/2016 dated 30.01.2017. Further reliance has made on the decision of the Hon'ble Supreme Court rendered in the case of CI....

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....Act. In rejoinder Ld. counsel for the assessee submitted that even the Ld. CIT(A) has sustained penalty u/s 271AAB(1)(a) of the Act while the assessing officer had initiated penalty u/s 271AAB(1)(b) of the Act. No notice of initiating penalty u/s 271AAB(1)(a) was given to the assessee. This fact is sufficient to set aside the impugned order. 6. We have heard the rival submissions and perused the material available on records and gone through the orders of the authorities below. We find that the assessing officer had given a notice which enclosed in the paper book at page 25 for the sake of clarity notice is reproduced as under: 7. A bare reading of the above notice suggests that the notice has been issued in a casual fashion. The Asse....

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....am, Date: 05/08/2015 NOTICE UNDER SECTION 274 READ WITH SECTION 271AAB OF THE INCOME TAX ACT, 1961 Whereas in the course of proceedings before me for the assessment year 2013-14 it appears to me that you:- *Have without reasonable cause failed to furnish me return of income with you were required to furnish by a notice given under section 22(1)/22(2)/34 of the India Income Fax Act, 1922 or which you were required to furnish under section 139(1) or by a notice given under section 139(2)/148 of the Income Tax Act 1964, No. dated... have without reasonable cause failed to furnish it within the allowed and the manner required by the side section 139(1) or by such notice. "Have without reasonable cause fail....