The Tax Publishers2021 TaxPub(DT) 0717 (Del-Trib)

INCOME TAX ACT, 1961

Section 271(1)(c)

Where show-cause notice issued under section 274 for levying penalty under section 271(1)(c) was defective as it did not specify in which limb of section 271(1)(c) the penalty proceedings had been initiated as such, the same would be regarded as bad in law and illegal and, as such, the entire penalty proceedings were liable to be vitiated.

Penalty under section 271(1)(c) - Notice under section 274 - Notice not specifying grounds on which penalty sought to be imposed -

AO revealed that no ITR was filed by the assessee for any of the assessment years. He thus, levied the penalty under section 271(1)(c) for willfully, knowingly and without any reasonable cause failure by assessee to file the return of income. Held: Notices issued by AO for levy of penalty under section 271(1)(c) to be bad in law as it did not specify in which limb of section 271(1)(c) the penalty proceedings had been initiated i.e. whether for concealment of particulars of income or furnishing inaccurate particulars of income. The show-cause notices were, therefore, bad in law and illegal and, as such, the entire penalty proceedings were vitiated and no penalty was leviable against the assessee in any of the years.

Followed:CIT v. SSAs Emerald Meadows [(2016) 73 Taxmann.com 241 (Karn-HC) : 2018 TaxPub(DT) 953 (Karn-HC)] and CIT & Anr. v. SSA'S Emerald Meadows (2016) 73 Taxmann.com 248 (SC) : 2016 TaxPub(DT) 4242 (SC).

REFERRED :

FAVOUR : In favour of assessee.

A.Y. :



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