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| The Tax Publishers2020 TaxPub(DT) 2044 (Karn-HC) INCOME TAX ACT, 1961
Section 271(1)(c)
Where AO had issued the notice of penalty without specifying the grounds on which the same was imposed, which is sine-qua-non for issuance of show-cause notice and for want of such particulars, therefore Tribunal rightly set-aside the order of the penalty levied on the assessee and there was no reason to entertain the appeal filed by revenue.
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Penalty under section 271(1)(c) - Defective notice - Notice issued by AO without specifying grounds of penalty -
AO during the assessment proceedings had noticed that assessee claimed depreciation of Rs. 10,23,53,309 as against admissible depreciation of Rs. 1,44,74,986. Thus, the AO disallowed a sum being payment made to harvesters/transporters and vehicle hire charges and legal fees. The said order having reached finality, AO initiated penalty proceedings in respect of aforesaid two claims and passed an order under section 271(1)(c). Assessee contended that notice issued under section 274 did not specify the grounds on which penalty was imposed, i.e., whether for concealment of income or for furnishing inaccurate particulars. Held: It was apparent that the show-cause notice issued under section 274 did not specifically disclose the charge against the assessee as to whether it was for concealment of particulars of income or furnishing of inaccurate particulars of income, which is sine-qua-non for issuance of show-cause notice and for want of such particulars. Tribunal set-aside the order of the penalty levied on the assessee. Therefore, there was no reason to entertain the appeal filed by revenue.
Followed:Sundaram Finance Ltd. v. Asstt. CIT [TCA No. 876 & 878/2008, dated 23-4-2018] : 2018 TaxPub(DT) 2565 (Mad-HC) and CIT & Ors. v. Manjunatha Cotton and Ginning Factory & Ors. (2013) 359 ITR 565 (Karn) : 2014 TaxPub(DT) 202 (Karn-HC).
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2010-11
IN THE KARNATAKA HIGH COURT
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