Mohan Exports India (P) Ltd. v. Dy. CIT

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The Tax Publishers2022 TaxPub(DT) 2292 (Del-Trib)

INCOME TAX ACT, 1961

Section 271(1)(c)

Penalty is not leviable where notice issued under section 271(1)(c) read with section 274 is without specifying limb of section 271(1)(c) under which penalty proceedings initiated, i.e., whether for concealment of particulars of income or furnishing of inaccurate particulars of income.

Penalty under section 271(1)(c) - Concealment or furnishing of inaccurate particulars of income - Non-specifying under which limb of section 271(1)(c) penalty proceedings initiated - Leviability of penalty

Notice issued to assessee under section 271(1)(c) read with section 274 without specifying under which limb of section 271(1)(c) penalty proceedings initiated, i.e., whether for concealment of particulars of income or furnishing of inaccurate particulars of income. He challenged imposition of penalty on basis of notice itself. CIT(A) affirmed levy of penalty. Aggrieved with order assessee made this appeal. Held: Penalty provisions are attracted where assessee has concealed particulars of income or furnished inaccurate particulars of such income. These two limbs carry different meanings. Therefore, it was imperative for AO to specify relevant limb so as to make assessee as to what was the charge made against him so that he could respond accordingly. Hence, notice issued without specifying limb of section 271(1)(c) under which penalty proceedings initiated, i.e., whether for concealment of particulars of income or furnishing of inaccurate particulars of income and proceeded with, was without application of mind and could not be considered a valid notice sufficient to impose penalty under section 271(1)(c). Penalty was deleted.

Followed:CIT & Anr. v. M/s. SSA's Emerald Meadows (2016) 242 Taxman 180 (SC) : 2016 TaxPub(DT) 4242 (SC)Relied:Pr. CIT & Ors. v. M/s. Sahara India Life Insurance Company Ltd. (2019) 432 ITR 84 (Del.) : 2019 TaxPub(DT) 6933 (Del-HC) and CIT & Anr. v. Manjunatha Cotton & Ginning Factory, Manjunath Ginning & Pressing, Veerbhadrappa Sangappa & Co., V.S. Lad & Sons, G.M. Export (2013) 359 ITR 565 (Kar) : 2014 TaxPub(DT) 0202 (Karn-HC)

REFERRED : The Pr. CIT (Central) v. M/s. Goa Coastal Resorts & Recreation (P) Ltd. Through Director (2021) 130 Taxmann.com 379 (SC) : 2021 TaxPub(DT) 5265 (SC)

FAVOUR : In assessee's favour

A.Y. :

IN THE ITAT, DELHI BENCH