TaxTMI 
TaxTMI 
2023 (7) TMI 854
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....come. 2. The facts in brief are the assessment was completed on 22.12.2017 u/s 143(3) of the Act based upon the request of assessee wherein it was requested by the assessee as follows; "This is with reference to above mentioned assessment proceedings for the A.Y. 2015-16, we would like to request your good self that the assessee company has filed its Return of Income ("ROI") by claiming business loss amounting to Rs. 17,87,88,640/-, however inspite of the above irrefutable position the assessee in good faith and, to avoid undue litigation, harassment and, to buy peace of mind is willing to get assessed at NIL income instead of declared loss of Rs. 17,87,88,640/- subject to the condition that no penalty/prosecution proceedings wo....
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....sed by the Ld. AO levying penalty is bad in alw and liable to be set aside as the notice issued under section 271(1)(c) was ambiguous as it did nto specify the offence alleged to be committed. The order levying penalty is not sustainable in law as it violates the principles of natural justice as the appellant was not provided a fair opportunity to defend its case. 4. Without prejudice, the penalty order passed by the Ld. AO and upheld by the Ld. CIT(A) is unsustainable on the facts and circumstances of the respective merits of the quantum issues / additions in the assessment order. 5. The order passed by the Ld. CIT(A) is bad in law and liable to be set aside as the same has been passed without appreciating the facts and c....
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....com 248 (SC) and preferred to rely judgment of Hon'ble Madras High Court in case of Sundaram Finlease Ltd. vs. ACIT 403 ITR 407. 5.1 Ld. DR however, defended the orders of Ld. Tax Authorities below. 6. Appreciating the matter on record, it comes up that there is no dispute to the fact that Ld. AO had not made any enquiry to discredit the claim of loss and had accepted the plea of bargain of the assessee to be assessed at Nil income instead of declared loss subject to the condition that no penalty / prosecution proceedings would be initiated against the assessee company under any other provisions of the Act including penalty proceedings u/s 271(1)(c) of the Act. The operative part of the findings of Ld. AO, as reproduced above, establi....
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....ailed to take note of the facts in Sundram Finlease Case where Hon'ble High Court has taken note of the following specific fact to not sustain the plea of assessee; "This was never the plea of the assessee either before the Assessing Officer or before the first Appellate Authority or before the Tribunal or before this Court when the Tax Case Appeals were filed and it was only after 10 years, when the appeals were listed for final hearing, this issue is sought to be raised." 9. However in the case in hand the plea was raised before the Ld. CIT(A) at first opportunity and he ought to have followed the binding precedent of Hon'ble Supreme Court in CIT vs. SSA's Emerald Meadows, (supra) where the Hon'ble Apex Court looked into the f....
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....d not satisfy the requirement of law. The assessee should know the grounds which he has to meet Otherwise, the principles of natural justice is offended. On the basis of such proceedings, no penalty could be imposed to the assessee. Penalty proceedings are distinct from assessment proceedings, though it emanates from the assessment proceedings; still it is separate and independent proceedings all together. 9.2 In 'Meherjee Cassinath Holdings Pvt. Ltd vs. ACIT (ITAT Mumbai)', ITA No. 2555/MUM/2012, order dated 28/04/2017, the observation of the Bench was that penalty proceedings under section 271(1)(c) of the Act are "quasi-criminal" proceedings and ought to comply with the principles of natural justice. The non striking of the irrelevant....