2019 (5) TMI 1374

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... appeal is regarding the upholding the action of AO by Ld. CIT(A) in levying penalty under section 271(1)(c) of the Act. The assessee has challenged the penalty on various grounds on legal issue as well as on merits. 3. The facts in brief are that the penalty was initiated in the assessment order framed under section 143(3) read with section 254 of the Act on 21.03.2014 wherein the penalty u/s 271(1)(c) of the Act has been initiated for both the limbs i.e. for furnishing of inaccurate particulars of income as well as for concealment of income as has been stated in para 4.5, 5.5 & 6.5 of the assessment order dated 21.03.2014. Besides , the notice under section 274 read with section 271(1)(c) of the Act was issued on 21.03.2014 without stri....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....er passed under section 271(1)(c) dated 23.09.2014, the AO levied the penalty for concealment of particulars of income which is blatantly wrong and against the ratio laid down by the various judicial forums. In defence of his argument, the Ld. A.R. relied on the following case laws: * CIT vs. SSA's Emerald Meadows (SC) 73 taxmann.com 248 dated 5.8.2016 * Mrs. Piedade Perinchery (BomHC) ITANo. 1310 of 2014 dated 10.01.2017 * Shri Samson Perinchery vs. CIT (Bom HC ) 392 ITR 4 dated 05.01.2017 * CIT vs. SSA's Emerald Meadows (Kar HC) 73 taxmann.com 241 dated 23. 11. 20 15 * CIT vs. Manjunatha Cotton & Ginning Factory 35 taxmann.com 250 (Karnataka) * K.M. Bhatia vs. CIT 62 TAXMAN 430 (GUJ.) * CIT vs. Lakhdhir Lalji 85 ITR ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....me by invoking exp 1 and 4 . Since the AO has correctly initiated the penalty proceedings by issuing notice under section 274 read with section 271 and the assessee duly participated in the penalty proceedings and the contentions raised by the assessee were duly considered. Therefore, it is not open to the assessee to claim that no proper opportunity was given as particular limb on which the penalty was proposed to be levied was not mentioned. The Ld. A.R. relied on the following decisions: 1. Union of India vs. Dharmendra Textile Processors (2007) 295 ITR 244 2. RL Traders vs. ITO (2017-TIOL-2583-HC-DEL-IT) 3. CIT vs. Zoom Communication (P) Ltd. (191 taxman 179 (Delhi)/(2010) 327 ITR 510 (Delhi)/(2010) 233 CTR 465 4. CIT vs. Moser ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....t words were not deleted by the AO. Thereafter, the penalty was imposed for concealment of particulars of income by invoking Exp 1 and 4 to section 271(1)(c) of the Act. In our opinion, by these acts of the AO in not striking off the inappropriate limb in the notice is clear cut in violation of principle of natural justice as the assessee was deprived of reasonable opportunity to respond and deal with the particular charge on which the penalty was levied. In our view, the penalty order in such a scenario is clearly bad in law and can not be sustained. The case of the assessee is clearly supported by the decision relied upon by the assessee as stated hereinabove in the case of Shri Samson Perinchery vs. CIT (supra) and CIT vs. Mrs. Piedade P....