TaxTMI 
TaxTMI 
2019 (6) TMI 141
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....el Communications. This firm is engaged in trading of telecom equipment including repairing and maintenance. The return of income was filed declaring income of Rs. 2,13,39,280/-. The return was initially processed u/s 143(1) of the Act and was subsequently selected for scrutiny. During the course of assessment proceedings, the Assessing Officer noticed that the assessee has purchased a product 'FCT 331T' from its sister concern at a rate of Rs. 1,778.85 per piece but was valued at Rs. 1310.66 per piece at the time of valuation of closing stock. The assessee was issued a show cause notice on the issue and, thereafter, considering the reply of the assessee, the closing stock of the product was valued at a price of Rs. 1,778.85 per piece leading to an addition of Rs. 38,08,758/-. 2.1 It was further noticed that the assessee had valued certain other products at nil value. The assessee was issued show cause notice on this issue also and, thereafter, an addition of Rs. 8,66,268/- was made on this account. 2.2 Further, the Assessing Officer also noticed that the assessee had valued one more product named 'Concorde' at a price of Rs. 1300/- per piece while its opening price was Rs. 1593.....
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....e as it failed to mention the ground for levy of penalty and even the amount of penalty was not mentioned. 7. That on the facts and circumstances of the case and in law, the penalty order dated 31.03.2017 passed by the Ld. AO is defective as it fails to specify the ground for imposing penalty. 8. That on the facts and circumstances of the case and in law, the penalty order dated 31.03.2017 passed by the Ld. AO is defective as computation of penalty amount is grossly incorrect. 9. The Ld. CIT(A) has erred on facts and in law in confirming the order of the Ld. Assessing Officer ("AO") imposing penalty u/s 271(1 )(c) who failed to apply his mind while passing the penalty order dated 31.03.2017 as the order talks of deduction under section 801C which is not applicable to the Assessee. 10. That on the facts and circumstances of the case and in law, the assessment order dated 30.03.2013 passed u/s 143(3) is defective as it fails to specify the ground for imposing penalty. 11. That on the facts and circumstances of the case and in law, the Ld. C1T(A) has erred in confirming the addition made by the Ld. AO who made the addition without giving an opportunity of being heard which i....
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....her submitted that the Hon'ble Apex Court in CIT vs. SSA's Emerald Meadows (2016) 73 taxmann.com 248 (SC) had upheld the judgment of the Hon'ble High Court of Karnataka in CIT vs. SSA's Emerald Meadows reported in (2016) 77 taxmann.com 241 (Karnataka) and had dismissed the appeal filed by the revenue wherein the Hon'ble Karnataka High Court had followed another judgment of the Hon'ble Karnataka High Court in the case of CIT vs. Manjunatha Cotton & Ginning Factory (2013) 359 ITR 565 wherein it had been held that notice issued by the Assessing Officer under section 274 read with section 271(1)(c) was bad in law as it did not specify under which limb of section 271(1)(c) penalty proceedings had been initiated i.e. whether for concealing particulars of income or for furnishing of inaccurate particulars of income. The Ld. AR submitted that this was a jurisdictional defect which could not be cured and, therefore, the penalty was not sustainable. 6.0 In response, the Ld. Sr. Departmental Representative (DR) submitted that in this particular case, both the charges were attracted and that the assessee had concealed his income as well as furnished inaccurate particulars of income. It was al....
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....er, on the facts and in the circumstances of the case, the Tribunal was justif ied in law in holding that the penalty notice under Section 274 r.w.s. 271(i)(c) is bad in law and inval id despite the amendment of Section 271 (1 B) with retrospective effect and by virtue of the amendment, the assessing off icer has initiated the penal ty by properly recording the satisfaction for the same ? (3) Whether on the facts and in the circumstances of the case, the Tribunal was justif ied in deciding the appeals against the Revenue on the basis of notice issued under Section 274 without taking into consideration the assessment order when the assessing off icer has specif ied that the 'assessee has concealed particulars of income?' 3. The Tribunal has allowed the appeal f iled by the assessee holding the notice issued by the Assessing Off icer under Section 274 read with Section 271(l)(c) of the Income Tax Act. 1961 for short 'the Act') to be bad in law as it did not specify which limb of Section 271 (l)(c) of the Act: the penal ty proceedings had been initiated i.e., whether for concealment of particulars of income or furnishing of inaccurate particulars of income The Tribunal....