TaxTMI 
TaxTMI 
2020 (3) TMI 1404
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....ered Accountant firm and had shown income under the heads income from profession and short term capital gains. For the assessment year 2007-08, they filed return of income on 11.11.2007 showing Profit and gains of business amounting to Rs 4,98,90,093/- and Short term capital gain of Rs 10,87,868/-. The Profit and Gain of business amounting to Rs 4,98,90,093/- was adjusted against brought forward losses from the earlier years and therefore total income was returned at Rs 10,87,868/- being short term capital gains. Brought forward losses claimed in the returned income amounted to Rs. 5,38,53,703. However, the losses set- off from Profit and Gain of business amounted to Rs 4,98,90,093/- and those carried forward to be set-off in future years a....
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....n 271 of the Act on 20.09.2012 and being not satisfied with the submissions of the assessee, imposed a penalty of Rs.48,93,726/- u/s. 271(1)(c) of the Act. 3. Aggrieved by such penalty, assessee preferred appeal before the Ld. CIT(A) and contended that no penalty was warranted as the assessee made a claim under a bona fide belief and all the relevant facts were disclosed in ITR and financial statements of the assessee company. CIT(A), however, partly allowed the appeal of the assessee by deleting the penalty only on the addition of Rs.75,978/- made on account of payment to one of its clients, AF Ferguson & Co. Aggrieved, the assessee is in appeal before us. 4. Ld. AR submitted at the outset that in this matter, there is neither concealmen....
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....sing Officer proposed the proceedings under section 271(1)(c) of the Act for concealing the particulars of income and furnishing of inaccurate particulars thereof. When it came to the notice issued under section 274 read with section 271 of the Act, such a notice does not specify whether it is for concealment of income or for furnishing of inaccurate particulars thereof, against which the assessee had to defend itself. Order under section 271(1)(c) of the Act narrates that the penalty was leviable under section 271(1)( c ) of the Act for concealment of income and furnishing of inaccurate particulars thereof. In this fact situation we shall refer to the decisions relied upon by the Ld. AR. 7. In the case of CIT vs Manjunatha Cotton & Ginnin....
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....d cannot be sustained. Thus once the proceedings are initiated on one ground, the penalty should also be imposed on the same ground. Where the basis of the initiation of penalty proceedings is not identical with the ground on which the penalty was imposed, the imposition of penalty is not valid. The validity of the order of penalty must be determined with reference to the information, facts and materials in the hands of the authority imposing the penalty at the time the order was passed and further discovery of facts subsequent to the imposition of penalty cannot validate the order of penalty which, when passed, was not sustainable." 8. In Commissioner of Income Tax v. SSA's Emerald Meadows (2016) 73 taxman.com 241 (Kar) the Hon'bl....
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....llenging the aforesaid judgement of the High Court was dismissed by the Hon'ble Supreme Court holding: "We do not find any merit in this petition. The special leave petition is, accordingly, dismissed." 11. In PCIT vs. Sahara India Life Insurance Company Limited case ITA No 475/2019 and batch order dated 02/08/2019, Hon'ble Delhi High Court, upheld the view taken by the Tribunal basing on the decision of the Hon'ble Karnataka High Court in the case of Manjunatha Cotton and Ginning Factory (supra) and SSA's Emerald Meadows (supra) wherein it was held that the notice issued by the learned Assessing Officer would be bad in law if it did not specify under which limb of section 271(1)(c) of the Act the penalty proceedings had ....