2018 (11) TMI 1908

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....rievance of the assesses are that the ld.CIT(A) has erred in confirming penalty of Rs.98,910/-, Rs.98,770/- and Rs.1,53,580/- imposed under section 271(1)(c) of the Act by the AO in the cases of S/Shri Allarakhu Babubhai Memon, Abdulrazak B. Kapadia and Bilal Babubhai Memon respectively. 3. At the outset, the ld.counsel for the assessee on the strength of Hon'ble Gujarat High Court decision in the case of CIT Vs. Manu Engineering Works, 122 ITR 0306 and in the case of Snita Transport P.Ltd. Vs. ACIT, 42 taxmann.com 54 contended that while imposing penalty, the ld.AO has to record a categorical finding whether such penalty is being imposed for concealment of income or furnishing of inaccurate particulars of income. He emphasised that thou....

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.... of penalty is sustained in view of the fact that the assessee had concealed the particulars of income. Thus insofar as final order of penalty was concerned, the Assessing Officer was clear and penalty was imposed for concealing particulars of income. In light of this, we may peruse the decision of this Court in case of Manu Engineering Works (supra). In the said decision, the Division Bench came to the conclusion that language of "and/or" may be proper in issuing a notice for penalty, but it was incumbent upon the Assessing Authority to come to a positive finding as to whether there was concealment of income by the assessee or whether any inaccurate particulars of such income had been furnished by them. If no such clear cut finding is reac....

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.... above, let us take note of penalty order in the case of Shri Allarakhu Babubhai Memon. It reads as under: "6. In these circumstances, the assessee has failed to offer any plausible explanation, I am satisfied that the assessee has willfully, knowingly and without reasonable cause furnished inaccurate particulars of its income and thus, tried to conceal the income so as to evade payment of tax thereon. Thus, Explanation 1 to section 271 of the Income-tax Act, 1961 is clearly applicable to the case of the assessee for furnishing inaccurate particulars of income and concealing the income for which it is liable to for penalty u/s.271(l)(c) of the Income-tax Act, 1961. I, therefore, levy a minimum penalty @100% of Rs. 98,910/- as again....