TaxTMI 
TaxTMI 
2025 (2) TMI 441
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....stances of the case and the provision of law the Ld CIT Appeal II has failed to appreciate that there was no valid action U/S 132 of the IT Act consequently the assessment order passed by the Ld AO u/s. 153A is bad in law and wrong on facts. 3. That the assessment framed is against the scheme of the Act whereby the reassessment in such search cases is to be confined to the additions and disallowances consequent to the material found during the course of the search and the material collected/available with the AO and relatable to such evidences and does not give power to the AO to re-appraise the already settled issues and the completed assessment. 4. That the Ld CIT Appeal II has failed to appreciate that impugned assessment order passed by the learned assessing officer is against the principles of natural justice and has been passed without affording reasonable opportunity of being heard. 5. That the Ld CIT Appeal II has failed to appreciate that on the facts and circumstances of the case, the various observations and findings of the learned assessing officer in the impugned assessment order is irrelevant and vitiated in the law. 6. That on the ....
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.... ITA No. 1262/Del/2014 (A.Y. 2005-06) "1. That on the facts and circumstances of the case and the provision of law the LdCIT(Appeal) has failed to appreciate that the initiation of proceedings u/s 271(1)(C) is illegal and bad in law. 2. That on the facts and circumstances of the case and the provision of law the Ld CIT(Appeal) has failed to appreciate that the impugned penalty order passed by learned assessing officer u/s 271(1)(C) is illegal, bad in law, time barred, without jurisdiction and wrong on facts. 3. That on the facts and circumstances of the case and the provision of law the Ld.CIT(Appeal) has failed to appreciate that impugned penalty order passed by the learned assessing officer is against the principles of natural justice and has been passed without affording reasonable opportunity of being heard. 4. That on the facts and on the circumstances of the case and the provision of law the Ld CIT Appeal has erred in sustaining the penalty of Rs. 7,52,866/-u/s 271(1)(c) of the Act. 5. That the Appellant craves the right to amend, append, delete any or all grounds of appeal." ITA No. 1638/Del/2010 (A.Y. 2005-06) 3. Brief fac....
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.... thus made an addition of Rs. 12,69,039/-. The ldCIT(A) after considering the submission and comments of the AO, upheld the rejection of the books of accounts. In this regard it has been observed by him as under:- "11.1.3.1 But it is a fact that appellant except producing the books of account maintained, sales and purchase bahis and stock register, has not been able to substantiate various debits made in the trading account and P&L Account by producing the relevant bills and vouchers. In the absence of bills and vouchers entries made in books/bahis cannot be verified and therefore, book results cannot be accepted as such." 27. The ld CIT(A) has also referred to the statement of Shri Abhay Gupta dated 03.05.2006, wherein the assessee along with all other family members have admitted that they are not disclosing correct gross-profit rate in all group concerns. However in the earlier part of the order, he has observed that so far as the instant year is concerned, the AO has not brought on record any material to point out defect in the books of account except saying that sales and purchase vouchers were not produced. He also observes that on verification it is ascerta....
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....aced any material on record to point out defects in books. The aforesaid finding is contradictory to his own finding reproduced above in this order at para 26 and therefore erroneous. Now coming to the estimation as noted above, AO had estimated sales at Rs. 1 crore and GP at 20%. Whereas, the ldCIT(A) has accepted the declared sales and estimated GP at 12%. In the instant case, it is crystal clear that each of the figures declared, be it sales or GP are unverifiable without supporting documents. Thus the question which remains is whether the estimation made by the AO is fair and reasonable on the facts on the case. We have already noted above while disposing of ground No. 1 to 3 that as a result of search, shri Ajay Gupta on behalf of assessee has admitted to unaccounted transactions outside regular books of accounts. It is also true that there is no material indicating unaccounted transactions particularly for the instant year unearthed during search, but it cannot be denied that once book results for the year under consideration are unverifiable in the absence of supporting vouchers, bills then the factum of admission u/s 132(4) of the Act made by Shri Abhay Gupta on behalf of t....
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.... dated 29/01/2014 dismissed the appeal filed by the Assessee. As against the order of Ld.CIT(A) dated 29/01/2014, the Assessee preferred the present appeal on the grounds mentioned above. 10. The Ld. Counsel for the contended that the initiation of the penalty proceedings and passing of the order of penalty are pursuant to the defective notice u/s 274 read with Section 271 of the Act, wherein the limb or charge for which the notice was issued has not been properly mentioned and the irrelevant limb has not been strike off by the A.O., therefore, the Ld. Counsel for the Assessee submitted that the penalty order passed based on the defective notice cannot be sustained. 11. Per contra, the Ld. DR submitted that the Ld.CIT(A) has adjudicated all the grounds and came to just conclusion by dismissing the appeal, thus, the Ld. DR relying on the orders of the Lower Authorities sought for dismissal of the appeal. 12. We have heard the parties, perused the material on record and gave our thoughtful consideration. The Assessee has produced the notice issued u/s 274 read with Section 271 of the Act, wherein the A.O. has not mentioned the specific charge or limb for which the notice was....
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....183. Therefore, we answer the first question to the effect that Goa Dourado Promotions and other cases have adopted an approach more in consonance with the statutory scheme. That means we must hold that Kaushaiya does not lay down the correct proposition of law. Question No.2: Has Kaushaiya failed to discuss the aspect of 'prejudice? 184. Indeed, Kaushaiya did discuss the aspect of prejudice. As we I.T.A.No.1409/Del/2016 have already noted, Kaushaiya noted that the assessment orders already contained the reasons why penalty should be initiated. So, the assessee, stresses Kaushaiya, "fully knew in detail the exact charge of the Revenue against him". For Kaushaiya, the statutory notice suffered from neither nonapplication of mind nor any prejudice. According to it, "the so-called ambiguous wording in the notice [has not] impaired or prejudiced the right of the assessee to a reasonable opportunity of being heard". It went onto observe that for sustaining the piea of natural justice on the ground of absence of opportunity, "it has to be established that prejudice is caused to the concerned person by the procedure followed". Kaushalya doses the discussion by observ....
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....e. 189. In Sudhir Kumar Singh, the Supreme Court has encapsulated the principles of prejudice. One of the principles is that "where procedural and/or substantive provisions of law embody the principles of natural justice, their infraction per se does not lead to invalidity of the orders passed. Here again, prejudice must be caused to the litigant, "except in the case of a mandatory provision of law which is conceived not only in individual interest but also in the public interest". 190. Here, section 271(1)(c) is one such provision. With calamitous, albeit commercial, consequences, the provision is mandatory and brooks no trifling with or dilution. For a further precedential prop, we may refer to Rajesh Kumar v. CIT[74], in which the Apex Court has quoted with approval its earlier judgment in State of Orissa v. Dr. Binapani Dei[ 75]. According to it, when by reason of action on the part of a statutory authority, civil or evil consequences ensue, principles of natural justice must be followed. In such an event, although no express provision is laid down on this behalf, compliance with principles of natural justice would be implicit. If a statue contravenes the prin....