TaxTMI 
TaxTMI 
2018 (3) TMI 1797
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.... 143(2) was issued to the assessee on 06- 03-2007. The assessee filed revised return of income offering the amount to tax claimed as exempt in the original return of income. The Assessing Officer initiated penalty proceedings u/s. 271(1)(c) in respect of LTCG claimed exempt in original return of income. Apart from above the Assessing Officer made addition of Rs. 29,14,221/- in respect of Short Term Capital Gains arising in the case of minor son of the assessee and clubbed the same in the hands of assessee. The Assessing Officer vide order dated 30-03-2011 levied penalty for furnishing inaccurate particulars of income and concealment of income. Aggrieved by the order levying penalty u/s. 271(1)(c) of the Act, the assessee filed appeal before the Commissioner of Income Tax (Appeals). The Commissioner of Income Tax (Appeals) vide impugned order deleted levy of penalty by placing reliance on the decision of Hon'ble Supreme Court of India in the case of Commissioner of Income Tax Vs. Reliance Petroproducts (P) Ltd. reported as 322 ITR 158. Against the findings of Commissioner of Income Tax (Appeals) now, the Revenue is in appeal before the Tribunal. 3. Shri Achal Sharma representi....
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....hat is furnishing of inaccurate particulars of income and concealed the income. Thus, from the perusal of order levying penalty it is evident that the Assessing Officer is not clear in his mind as to under which limb of section 271(1)(c) of the Act, the penalty is to be levied. 6. The ld. DR raised strong objection to the fresh argument being raised by AR of assessee with respect to defect in limb. The ld. DR submitted that this argument of defect is being raised by assessee for the first time before Tribunal. No such ground was raised before Commissioner of Income Tax (Appeals) and the assessee has not filed any separate appeal or cross objections on this legal issue. 7. We have heard the submissions made by representatives of rival sides and have perused the orders of the authorities below. Before going to the merits of appeal by Revenue, we will first take up the legal ground raised by assessee challenging the validity of penalty proceedings in not specifying the charge for levy of penalty u/s. 271(1)(c) at the time of recording of satisfaction and thereafter, levying penalty u/s. 271(1)(c) for furnishing inaccurate particulars of income and also making reference to concea....
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....bjection?" The Hon'ble High Court answered the above question in favour of the assessee-respondent as under: "5. The Tribunal was not required to embark on an enquiry, which was outside the scope of the assessee's claim and the claim made by the assessee before the ITO was that the capital gain was a long-term capital gain. The facts required for examining the claim were before the Tribunal. The absence of an appeal by the assessee against the order of the AAC, who had remanded the matter to the ITO, did not in anyway preclude the Tribunal from holding that the capital gain in the instant case was a longterm capital gain. The ends of justice justify the Tribunal to grant the relief to the assessee even in the absence of a specific appeal or cross-appeal, if the facts available on record permit the grant of such relief and such relief had in fact been sought by the assessee before the assessing authority. Similar proposition has been laid by the Hon'ble Bombay High Court in the case of B.R. Bamasi Vs. Commissioner of Income Tax reported as 83 ITR 223. Thus, in view of the judgments discussed above and the fact that legal ground raised by ld. AR of assessee is emanatin....
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....articulars of income. No doubt, the facts of some cases may attract both the offences and in some cases there may be overlapping of the two offences but in such cases the initiation of the penalty proceedings also must be for both the offences. But drawing up penalty proceedings for one offence and finding the assessee guilty of another offence or finding him guilty for either the one or the other cannot be sustained in law. It is needless to point out satisfaction of the existence of the grounds mentioned in Section 271(1)(c) when it is a sine qua non for initiation or proceedings, the penalty proceedings should be confined only to those grounds and the said grounds have to be specifically stated so that the assessee would have the opportunity to meet those grounds. After, he places his version and tries to substantiate his claim, if at all, penalty is to be imposed, it should be imposed only on the grounds on which he is called upon to answer. It is not open to the authority, at the time of imposing penalty to impose penalty on the grounds other than what assessee was called upon to meet. Otherwise though the initiation of penalty proceedings may be valid and legal, the final ord....