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Facts
The assessee's appeal was filed with a delay of 8 days, supported by an affidavit and medical records. The Assessing Officer had initiated penalty proceedings under section 271(1)(c) of the Income Tax Act, 1961, based on a vague satisfaction notice.
Held
The Tribunal held that the penalty initiated in a vague manner and levied on a different charge than initially invoked is unsustainable. Therefore, the penalty order was deleted.
Key Issues
Whether penalty initiated on a vague satisfaction and levied on a different charge is sustainable under Section 271(1)(c) of the Income Tax Act, 1961?
Sections Cited
271(1)(c), 143(3)
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Income Tax Appellate Tribunal, DELHI BENCH “SMC”, DELHI
(A.Y.2011-12) Mohd. Umar, Village Siroli, Tehsil Punhana, Mewat, ...... अपीलाथ�/Appellant Nuh, Palwal, Haryana 121103 PAN: AABPU-9980-G बनाम Vs. Income Tax Officer, Ward-1(5) ..... �ितवादी/Respondent CGO Complex, Faridabad, Haryana 121001 अपीलाथ� �ारा/Appellant by : None �ितवादी�ारा/Respondent by : Ms. Sudha Gupta, Sr.DR सुनवाई क� ितिथ/ Date of hearing : 31/07/2025 घोषणा क� ितिथ/ Date of pronouncement : : 31/07/2025 आदेश/ORDER
PER VIKAS AWASTHY, JM:
This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [in short ‘the CIT(A)] dated 03.02.2025, for Assessment Year 2011-12.
The appeal is time barred by 8 days. The assessee has filed a petition for condonation of delay supported by an affidavit and Medical records. After perusal of same, I am satisfied that delay in filing of appeal is not intentional, but is for the reasons stated in the condonation petition which appears to be bonafide. Hence, delay in filing of appeal is condoned and appeal is admitted for hearing on merits.
(AY 2011-12) 3. In this appeal, the assessee has assailed penalty levied u/s. 271(1)(c) of the Income Tax Act,1961(hereinafter referred to as ‘the Act’) confirmed by the CIT(A). A perusal of the assessment order dated 04.07.2013 passed u/s. 143(3) of the Act reveals that the Assessing Officer (AO) has initiated penalty u/s. 271(1)(c) of the Act by observing as under:- “I am satisfied that the assessee has concealed his income by furnished inaccurate particulars of his income on this account and, therefore, penalty proceedings u/s 271(1)(c) of the Income Tax Act, 1961 are hereby initiated separately.”
A perusal of satisfaction recorded by the AO shows vagueness in the mind of the Assessing Officer with regard to charge u/s. 271(1)(c) of the Act on which penalty is to be levied. The Hon’ble Supreme Court of India in the case of T. Ashok Pai vs CIT, 161 Taxman 340 has held that ‘concealment of income’ and ‘furnishing inaccurate particulars’ carry different connotations.
Thereafter, the AO vide order dated 26.06.2018 levied penalty u/s. 271(1)(c) of the Act for concealment of particulars of income. The Hon’ble Bombay High Court in the case of CIT vs. Samson Perinchery, 392 ITR 4 has held that penalty initiated on one limb and levied on the other limb of section 271(1)(c) of the Act is unsustainable.
In light of the fact that penalty has been initiated by the AO in a vague and ambiguous manner and thereafter, the penalty has been levied on a charge different from the one invoked in the assessment order at the time of recording satisfaction, the penalty is unsustainable, hence, deleted.