2022 (9) TMI 589

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.... have filed the return of income for A.Y. 2011-12 on 30.09.2011 declaring Nil income. The case of the assessee was selected for scrutiny and thereafter assessment was framed u/s 143(3) of the Act vide order dated 31.03.2014 and addition was made on account of disallowance of agricultural income claimed by assessee amounting to Rs.45,87,650/-, addition on account of delayed payment of Rs.1,38,780/- and disallowance of 'Administrative & Selling Expenses'. On account of aforesaid disallowances made by AO, AO levied penalty of Rs.14,17,600/- u/s 271(1)(c) of the Act vide order dated 18.01.2018. Aggrieved by the order of AO, assessee carried the matter before CIT(A) who vide order dated 21.08.2018 in Appeal No.3969-3457-1150-218 dismissed the ap....

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....d by the AO in support of said addition/disallowance hence no penalty U/s 271(1)(c) could be levied on the basis of such a disallowance. 7. That the CIT(A) has erred in law and on facts in non-quashing of penalty proceedings u/s 271(1)(c) which is wrongly initiated by the AO. 8. Penalty proceedings have been initiated without any specific charges hence the same are liable to be set aside. 9. That in any case the penalty imposed is unjust, arbitrary and highly excessive." 4. On the date of hearing, none appeared on behalf of the assessee nor any adjournment application was filed on its behalf though the file reveals that the notice of hearing was served on the assessee. We find that assessee is challenging the l....

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.... Act. Before CIT(A), assessee had submitted that in the notice dated 26.12.2017 issued u/s 274 r.w.s 271(1)(c) the specific limb of Section 271(1)(c) of the Act has not been indicated by AO. 8. We find that Hon'ble Delhi High Court in the case of PCIT vs. Sahara India Life Insurance Co. Ltd. (2021) 432 ITR 84 (Del.), after considering the decision in the case of CIT vs. Manjunatha Cotton & Ginning Factory (2013) 359 ITR 565 (Kar) & CIT vs. SSA's Emerald Meadows (2016) 73 Taxman.com 241 (Kar) [where the SLP filed by Revenue was dismissed and reported in (2016) 386 ITR (ST) 13 (SC)] has held that penalty u/s 271(1)(c) was not leviable when the notice issued by AO did not specify as to whether the proceedings were initiated for concealm....