2021 (12) TMI 982

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....d out from the record that the assessee is engaged in the business of construction of highways as an approved NHAI engineering procurement construction contractor and also providing related services. For the assessment year 2009-10 they have filed their return of income declaring a loss of Rs. 19,84,59,799/-. Assessment under section 143(3) of the Income Tax Act, 1961 (for short "the Act") was complete by order dated 24/12/2011 by making certain additions on account of disallowance of legal expenses, interest on working capital, banking charges and foreign exchange loss. Learned Assessing Officer simultaneously initiated proceedings under section 271(1)(c) of the Act against the assessee for concealment of income/furnishing of inaccurate pa....

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.... facts assessee for the assessment were revealed before the learned Assessing Officer, and therefore, no penalty is leviable. By placing reliance on the decisions of the Hon'ble Karnataka High Court in the case of CIT vs. Manjunatha Cotton and Ginning Factory (2013) 359 ITR 565, Commissioner of Income Tax v. SSA's Emerald Meadows (2016) 73 taxman.com 241 (SC) and also the decision of the Hon'ble jurisdictional High Court in the case of Ld. PCIT vs. Sahara India Life Insurance Co Ltd in ITA No. 475 and batch of 2019, Ld. AR submitted that penalty cannot be sustained. 5. Per contra, placing on the decision of the Hon'ble Madras High Court in the case of Sundaram Finance Ltd vs. CIT (2018) 403 ITR 407 (Madras), Ld. DR submitted that the asses....

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.... themselves. 7. In the case of CIT vs Manjunatha Cotton & Ginning Factory, 359 ITR 565 (Kar). Vide paragraph 60, the Hon'ble Karnataka High Court has held as follows :- "60. Clause (c) deals with two specific offences, that is to say, concealing particulars of income or furnishing inaccurate particulars 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 ....

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....rald Meadows (2016) 73 taxman.com 241 (Kar) the Hon'ble Karnataka High Court Considered the question of law as to,- "Whether, omission if assessing officer to explicitly mention that penalty proceedings are being initiated for furnishing of inaccurate particulars or that for concealment of income makes the penalty order liable for cancellation even when it has been proved beyond reasonable doubt that the assessee had concealed income in the facts and circumstances of the case?" And the Hon'be High Court ruled answered the same in favour of the assessee observing that: "The Tribunal has allowed the appeal filed by the assessee holding the notice issued by the Assessing Officer under Section 274 read with Section 271(1)(c) of the Income ....

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....alty proceedings had been initiated under i.e., whether for concealment of particulars of income or for furnishing of inaccurate particulars thereof. Relevant observations of the Hon'ble High Court read that,- "21. The Respondent had challenging the upholding of the penalty imposed under section 271(1)(c) of the Act, which was accepted by the ITAT. It followed the decision of 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 Ka....