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Facts
Four appeals were filed by two assessees, Sh. Vijay Kumar Gupta and Sh. Anish Kumar Gupta, concerning penalty proceedings under Section 271(1)(c) and 271C of the Income-tax Act for assessment years 2007-08 and 2008-09. The assessees challenged the penalty orders due to the show-cause notices not specifying the limb under which the penalty was being levied.
Held
The Tribunal held that the failure of the Assessing Officer to specify the exact limb (concealment of income or furnishing inaccurate particulars) in the penalty show-cause notices vitiates the penalty proceedings. Reliance was placed on judicial precedents for this decision.
Key Issues
Whether penalty proceedings are vitiated if the show-cause notice under Section 271(1)(c) does not specify the specific limb (concealment or inaccurate particulars) under which the penalty is to be levied.
Sections Cited
271(1)(c), 271C, 274
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Income Tax Appellate Tribunal, DELHI BENCH: ‘B’ NEW DELHI
Before: SHRI SATBEER SINGH GODARA & SHRI MANISH AGARWAL
ORDER
PER SATBEER SINGH GODARA, JM
The instant batch of four appeals involves twin assessees, namely, Sh. Vijay Kumar Gupta and Sh. Anish Kumar Gupta. The first assessee, Sh. Vijay Kumar Gupta has filed & 567/Del/2025 pertaining to assessment years 2007-08 and 2008- 09 against Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre [in short, the “CIT(A)/NFAC”], Delhi’s orders dated 20.11.2024 and 11.06.2024 having DIN and Order Nos. ITBA/NFAC/S/250/2024-25/1070481230(1) and ITBA/ NFAC/S/250/2024-25/1065531885(1) & the second assessee Sh. Anish Kumar Gupta has preferred & 569/Del/2025 against the CIT(A)/NFAC, Delhi’s orders, both dated 15.01.2025 having DIN and order no. ITBA/NFAC/S/250/2024- 25/1072174011(1) and ITBA/NFAC/S/250/2024- 25/1072174294(1) involving proceedings under section 271(1)(c) and 271C of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’), respectively.
Heard both the parties. Case files perused.
It emerges at the outset during the course of hearing that both the learned lower authorities have held the assessees to have levied section 271(1)(c) penalty(ies) in question amounting to Rs.87,45,884/- each for both the assessment years 2007-08 and 2008-09 in case of first
2 | P a g e assessee; and Rs.44,48,836/- each for both the assessment years 2007-08 and 2008-09 in the case of second assessee vide Assessing Officer’s orders dated 28.03.2023 and 22.05.2023; respectively, which stand upheld in the CIT(A)’s detailed lower appellate discussion.
The assessees have first of all raised their legal pleas that once the learned Assessing Officer had admittedly issued his as many penalties show-cause notice dated 30.12.2017 and 30.03.2015 u/s 271(1)(c) r.w.s. 274 of the Act not specifying any specific limb as to whether they had concealed or furnished inaccurate particulars of taxable income; as the case may be, his failure to this effect vitiates the entire proceedings therefore. Relevant notices dated 30.03.2015 and 30.12.2017 form part of the records before us. This clinching fact has gone unrebutted from the Revenue side.
Faced with this situation, we quote PCIT Vs. Sahara India Life Insurance Co. Ltd. (2021) 432 ITR 84 (Del.) and PCIT Vs. Gopal Kumar Goyal (2023) 153 taxmann.com 534 (Del.) to conclude that once the learned Assessing Officer