2020 (5) TMI 298

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....9,90,570/- levied by the Assessing Officer u/s 271(1)(c) of the Income tax Act, 1961 [hereinafter referred to as 'The Act' for short] and, in particular, ground relating to clarity in the notice issued u/s 271(1)(c) of the Act. 3. The roots for levy of penalty lie in the assessment order dated 28.12.2016 framed u/s 143(3) of the Act wherein, inter alia, addition of Rs. 23.53 crores was made by the Assessing Officer by invoking the provisions of section 56(2)((vii)(b) of the Act r.w.r. 11UA of the I.T. Rules. 4. Before us, the ld. counsel for the assessee strongly drew our attention of the notice issued u/s 274 r.w.s 271(1)(c) of the Act, which is as under: Notice Under Section 274 Read With Section 271(l)(c) of the Income Tax Ac....

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..... 475 of 2019 order dated 02.08.2019. 6. Per contra, the ld. DR vehemently stated that in the assessment order itself, while making addition of Rs. 23.53 crores, filing of inaccurate particular of income was detected and penalty has also been levied for filing of inaccurate particulars of income as is evident from the concluding para of the penalty order. 7. We have given thoughtful consideration to the orders of the authorities below. Notice u/s 274 of the Act is exhibited elsewhere. There is no dispute that while issuing notice, the Assessing Officer did not make his intention clear whether the penalty is going to be levied for concealing particulars of income or furnishing of inaccurate particular of income. This is further fortified ....

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....ed the decision of the Karnataka High Court in CIT v. Manjunatha Cotton & Ginning Factory 359 ITR 565 (Kar) and observed that the notice issued by the AO would be bad in law if it did not specify which limb of Section 271(1) (c) the penalty proceedings had been initiated under i.e. whether for concealment of particulars of inc me or for furnishing of inaccurate particulars of income. The Karnataka High Court had followed the above judgment in the subsequent order in Commissioner of Income Tax v. SSA's Emerald Meadows (2016) 73 Taxman.com 241 (Kar) , the appeal against which was dismissed by the Supreme Court of India in SLP No. 11485 of2016 by order dated 5th August, 2016." 11. If the notice is read with the decision of the Hon'ble....