2021 (11) TMI 86

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....appellant is not liable to penalty u/s. 271(1) (c) on the following grounds: i) That the Ld. CIT(A) has not considered the various facts before passing the order. ii) That addition was made on the basis of certain expenditure written in a note pad which does not belong to the appellant. There was no material available to assume that expenditure was incurred by the appellant and no penalty can be imposed on ad hoc additions. iii) That the Ld. A.O has imposed penalty without specifying in the show cause notice dated 18.03.2015 that penalty is imposed for concealment of Income or for furnishing inaccurate particulars. Therefore the basis taken and method adopted by the assessing officer for imposing penalty u/s. 271 (1)(c) for Rs. 5,42....

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....e expenditure was incurred by the assessee. Hence, no penalty could be imposed on such ad-hoc addition. Moreover, the penalty has been imposed without specifying specific charge in the notice issued u/s. 274 of the Act. Therefore, assumption of jurisdiction was contrary to the settled proposition of law. Further, the ld. counsel for the assessee submitted that the facts were identical in the Assessment Year under appeal and Assessment Year 2010-11 interestingly, the Assessing Officer in the Assessment Year 2010-11, dropped the penalty proceedings, however imposed in the Assessment Year under appeal in arbitrary and unjustified manner. He further submitted that even otherwise also this penalty cannot be sustained as the same has been imposed....