TaxTMI 
TaxTMI 
2025 (2) TMI 1426
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....t, 1961[hereinafter referred to as 'the Act'], whereby the Ld. CIT(A) had dismissed the appeal of the Assessee against the Penalty Order, dated 22/09/2015, passed under Section 271(1)(c) of the Act, for the Assessment Year 2007-2008. 2. The relevant facts in brief are that the Assessee, a qualified chartered accountant, was at the relevant time a partner in M/s Jayantilal Thakkar & Co. and Jayantilal Thakkar Associates. The Assessee had not filed return of income for the Assessment Year 2007-08 under Section 139(1) of the Act and penalty proceedings were initiated under Section 271F of the Act. 3. Subsequently, a search was carried out in the case of the Assessee on 10/08/2011. Subsequently, in response to notice issued under Section ....
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....(c) of the Act whereby a penalty of INR. 1,13,84,395/- was levied on the Assessee under Section 271(1)(c) of the Act for furnishing inaccurate particulars of income of INR. 3,38,21,732/-. 5. The Assessee challenged the above penalty order in appeal before the CIT(A), inter alia, raising the following ground: "1. The penalty order passed by the Assessing Officer under Section 271(1)(c) of the Act is illegal and bad in law, in violation of statutory provisions of the law." 6. Before the CIT(A), vide submission dated 17/11/2018, contended that the notice under Section 271(1)(c) read with Section 274 of the Act was bad in law since the same was issued without striking off the irrelevant limb/portions. In support, reliance was pla....
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....of income. Thus, the penalty of Rs. 3,72,75,698/- levied u/s.271(1)(c) is upheld." 8. The Assessee is now in appeal before the Tribunal. 9. During the course of hearing the Assessee reiterated the submission made before the CIT(A). In addition the Assessee submitted that in view of the provisions contained in Section 271AAA(3) of the Act, no penalty under Section 271(1)(c) of the Act could have been levied. 10. Per contra the Learned Departmental Representative relied upon the order passed by the Assessing Officer and the CIT(A). She submitted that the submission made by the Assessee in relation to Section 271AAA(3) of the Act was raised for the first time before the Tribunal. Further, Section 271AAA of the Act was applicable in re....
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.... 14. However, we do find that the primary contention raised by the Assessee stands decided in favour of the Assessee by the judgment of Full Bench of the Hon'ble Bombay High Court in the case Mohammed Farhan A Shaikh Vs DCIT (supra). In that case it was held by the Jurisdictional High Court that a mere defect in the notice - not striking off the irrelevant matter, would vitiate the penalty proceedings. The relevant extract of the aforesaid judgment reads as under: "Answers: Question No. 1: If the assessment order clearly records satisfaction for imposing penalty on one or the other, or both grounds mentioned in Section 271(1)(c), does a mere defect in the notice-not striking off the irrelevant matter-vitiate the penalty ....
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....s, the Assessing Officer has stated that 'Issued notice under Section 274 rws. 271(1)(c) of the Act'. Though it was contended on behalf of the Revenue that it could be inferred from the Assessment Order that the penalty proceedings were initiated for furnishing inaccurate particulars on income, there is nothing on record to show that the Assessee was 'informed of the grounds of the penalty proceedings through statutory notice'. In view of the aforesaid, we find merit in the contention advance on behalf of the Assessee that penalty levied Section 271(1)(c) of the Act cannot be sustained as per the judgment of the Full Bench decision of the Hon'ble jurisdictional High Court in case of Mohammed Farhan A Shaikh Vs DCIT (supra). Thus, penal ....