1984 (3) TMI 145

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.... the CIT(A) who cancelled the penalty of Rs. 34,100 levied by the ITO under s. 271(1)(c) of the IT Act, 1961. In order to appreciate the issue, it will be better in case facts pertaining to the issue are stated briefly. 2. The assessment year involved is 1975-76. The ITO in the course of assessment proceedings had added two cash credits of Rs. 19,100 and Rs. 15,000 in the names of Ramji Dass an....

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....e the CIT(A), he cancelled the same on the basis of observations that no opportunity had been allowed by the ITO to the assessee as envisaged under s. 274(1). 4. The ld. departmental representative Mr. M.P. Singh while disputing the said action of the CIT(A) vehemently argued that grant of opportunity is a procedural matter and in that regard he relied on the cases of Guduthur Bros. vs. ITO (19....

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....e is no mention regarding initiation of penalty proceedings under s. 271(1)(c) and as on 3rd Oct., 1977 the assessee's counsel was required to explain the cash credits, he was also given a notice for concealment of the same which was pre-mature and could not be termed as initiation of penalty proceedings as the assessment was framed subsequently on 27th Feb., 1978 and in the said assessment order ....

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....e old Act in which there was no controversy regarding limitation for levy of penalty. Similar is the case of Ram Gopal Neotia on which reliance is placed by the ld. departmental representative which too is misplaced due to distinction in facts of the instant case. Even Boina Surenna case is different. In the instant case, even if for the sake of argument, the contention of the ld. departmental rep....