M/S. UNITECH RELIABLE PROJECTS PVT. LTD.,NEW DELHI vs. DCIT, CIRCLE-27(1), NEW DELHI

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ITA 9005/DEL/2019Status: DisposedITAT Delhi30 July 2025AY 2015-16Bench: SHRI VIKAS AWASTHY (Judicial Member), SHRI MANISH AGARWAL (Accountant Member)1 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the penalty notice was issued in an omnibus manner and mentioned both charges ('concealed particulars of income' and 'furnished inaccurate particulars of income') with the conjunction 'or', making it ambiguous and thus defective.

What were the facts?

The assessee's appeal was against the CIT(A)'s order upholding a penalty. The assessee argued that the penalty notice issued under Section 271(1)(c) read with Section 274 of the Income Tax Act was defective.

What were the issues?

Whether a penalty notice issued under Section 271(1)(c) of the Income Tax Act is vitiated if it is ambiguous and fails to strike out irrelevant charges.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 274,Section 142(1),Section 143(2)

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

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Income Tax Appellate Tribunal, DELHI BENCH “F”, DELHI

For Appellant: Shri D.C Garg, Chartered Accountant
Hearing: 16/07/2025

आदेश/ORDER

PER VIKAS AWASTHY, JM:

1.

This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals), Delhi [in short ‘the CIT(A)] dated 30.10.2019, for Assessment Year 2015-16.

2.

The ld. AR of the assessee submits that the assessee at this stage is only pressing ground no. 5 of appeal assailing validity of penalty notice issued u/s. 271(1)(c) of the Act. The notice dated 30.11.2017 issued u/s. 274 r.w.s. 271(1)(c) of the Income Tax Act,1961(hereinafter referred to as ‘the Act’) does not clearly specify the charge u/s. 271(1)(c) of the Act for which penalty is to be levied. The notice is issued in a mechanical manner without proper application of mind. The ld. AR placed on record copy of the said notice. He submitted that where the notice is ambiguous and irrelevant clauses are not struck of, notice becomes defective and not penalty can be levied on the basis of defective notice. In support of his submissions he placed reliance on the decision of the Full Bench of Hon'ble Bombay High Court in the case of Mohd. Farhan A. Shaikh vs. DCIT reported as 125 taxmann.com 253.

3.

Per contra, Ms. Monika Singh representing the department vehemently defended the penalty order and prayed for dismissing appeal of the assessee.

4.

Both sides heard. The assessee in appeal has assailed validity of penalty proceedings u/s. 271(1)(c) of the Act on the ground of defective notice. The assessee has placed on record copy of notice issued u/s. 274 r.w.s. 271(1)(c) of the Act, the same is extracted herein below:-

A bare perusal of notice would show that the same has been issued in an omnibus manner. The irrelevant charge for levy of penalty u/s. 271(1)(c) of the Act has not been struck of by the AO. The notice mentions both charges of section 271(1)(c) of the Act i.e. “concealed the particulars of income” and “furnish inaccurate particulars of income” with conjunction “or”. This makes the notice ambiguous. It is a well settled legal proposition that where there is ambiguity in mentioning of charge in the notice, the notice becomes defective. (RE: Mohd.

Farhan A. Shaikh vs. DCIT reported as 125 taxmann.com 253.) Any proceedings arises from defective notice are vitiated.

5.

Thus, in facts of the case and in light of the decision referred above, we find merit in ground no. 5 of appeal. Thus, impugned order is set aside and appeal of the assessee is allowed. Order pronounced in the open court on Wednesday the 30th day of July, 2025. Sd/- Sd/- (MANISH AGARWAL) (VIKAS AWASTHY) लेखाकार सद�य/ACCOUNTANT MEMBER �याियक सद�य/JUDICIAL MEMBER िद�ी/Delhi, �दनांक/Dated 30/07/2025 NV/- �ितिलिप अ�ेिषतCopy of the Order forwarded to : अपीलाथ�/The Appellant , 1. �ितवादी/ The Respondent. 2.

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