2021 (4) TMI 256

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....on record. 3. The assessee filed an application in all the years for admission of an additional ground of appeal which is common in all the appeals and reads as under : "a) On the facts and under the circumstances of the case the penalty levied under section 271(1)(C) of the Act is void as the notice u/s 274 Read with Sec. 271 is bad and defective as it is issued without deleting the appropriate clause under which the penalty is proposed to be imposed is either for filling of inaccurate particular of income or concealment of particular of income and as such the notice is not sustainable and not curable." 3.1. Learned Counsel for the Assessee placed on record copies of the show cause notice for each year issued under section 2....

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....nalty proceedings are vitiated and are liable to be quashed on this reason alone. 7. On the other hand, the Ld. D.R. relied upon the Orders of the authorities below and submitted that A.O. has recorded proper satisfaction in the impugned orders. Therefore, penalty proceedings need not be cancelled. 8. We have considered the rival submissions. It is an admitted fact that before levy of the penalty A.O. has issued show cause notice Dated 20.06.2014 in all the years in which A.O. has mentioned both the limbs of Section 271(1)(c) of the I.T. Act that assessee have concealed the particulars of your income or furnished inaccurate particulars of such income. Thus the A.O. has not mentioned as to for which limb of Section 271(1)(c) of the ....

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....AT. It followed 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 income 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 of 2016 by order dated 5th August, 2016. 22. On this issue again this Court is unable to....