TaxTMI 
TaxTMI 
TaxTMI 
2020 (12) TMI 812
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.... Circle-3, Patna u/s. 274 of the Act wherein he does not specify the fault/charge on which he proposed to levy penalty against the assessee u/s. 271(1)(c) of the Act. The Ld. AR drew my attention to the fact that the AO has not stricken down either of the limbs i.e. 'concealed the particular of income' or 'furnished inaccurate particulars of such income'. According to the Ld. Counsel, since both the faults/charges are discernible from the show cause notice, the show cause notice is bad in law for not specifying the fault for which the assessee is being proceeded against. 3. It is noted that the AO has not stricken out the irrelevant portion of the fault/charge which would have spelt out the specific fault/charge against the....
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....anjunatha Cotton and Ginning factory (supra) came to the conclusion that imposition of penalty on defective show cause notice without specifying the charge against the assessee cannot be sustained. My attention was also drawn to the decision of ITAT in the case of Suvaprasanna Bhattacharya vs. ACIT in ITA No. 1303/Kol/2010 dated 06.11.2015 wherein identical proposition has been followed by the Tribunal. 4. Ld. DR Shri Ajay Kumar vehemently opposed the submission of the Ld. AR and has cited various case laws to oppose the case laws suggested by the Ld. AR. It is noted that all the case laws cited before me by the Ld. DR has been dealt with elaborately by the Coordinate Bench of this Tribunal in the case of Jeetmal Choraria Vs. ACIT, ITA No.....
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....been given in the written note filed before us. 9. In the case of CIT Vs. Kaushalya (supra), the Hon'ble Bombay High Court held that section 274 or any other provision in the Act or the Rules, does not either mandate the giving of notice or its issuance in a particular form. Penalty proceedings are quasi-criminal in nature. Section 274 contains the principle of natural justice of the assessee being heard before levying penalty. Rules of natural justice cannot be imprisoned in any straight-jacket formula. For sustaining a complaint of failure of the Principles of natural justice on the ground of absence of opportunity, it has to be established that prejudice is caused to the concerned person by the procedure followed. The issuance of n....
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....e notice u/s. 274 of the Act. This is not factually correct. One of the parties before the group of Assessees before the Karnataka High Court in the case of Manjunatha Cotton & Ginning (supra) was an Assessee by name M/s. Veerabhadrappa Sangappa & Co., in ITA NO. 5020 OF 2009 which was an appeal by the revenue. The Tribunal held that on perusal of the notice issued under Section 271(1)(c) of the Act, it is clear that it is a standard proforma used by the Assessing Authority. Before issuing the notice the inappropriate words and paragraphs were neither struck off nor deleted. The Assessing Authority was not sure as to whether she had proceeded on the basis that the assessee had either concealed its income or has furnished inaccurate details.....
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....sing Authority was legal and valid? The Hon'ble Karnataka High Court held in the negative and against the revenue on both the questions. Therefore the decision rendered by the ITAT Mumbai in the case of Earthmoving Equipment Service Corporation (supra) is of no assistance to the plea of the revenue before us. 11. In the case of M/S. Maharaj Garage & Co. Vs. CIT dated 22.8.2017 referred to in the written note given by the learned DR, which is an unreported decision and a copy of the same was not furnished, the same proposition as was laid down by the Hon'ble Bombay High Court in the case of Smt. Kaushalya (supra) appears to have been reiterated, as is evident from the extracts furnished in the written note furnished by the learned ....
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....a reading of the Assessment order in which the penalty was initiated. 14. From the aforesaid discussion it can be seen that the line of reasoning of the Hon'ble Bombay High Court and the Hon'ble Patna High Court is that issuance of notice is an administrative device for informing the assessee about the proposal to levy penalty in order to enable him to explain as to why it should not be done. Mere mistake in the language used or mere non-striking of the inaccurate portion cannot by itself invalidate the notice. The Tribunal Benches at Mumbai and Patna being subordinate to the Hon'ble Bombay High Court and Patna High Court are bound to follow the aforesaid view. The Tribunal Benches at Bangalore have to follow the decision of t....