DEPUTY COMMISSIONER OF INCOME TAX, NOIDA vs. AKC RETAILERS PRIVATE LIMITED, NEW DELHI

PDF · subscribers
ITA 7690/DEL/2025Status: DisposedITAT Delhi20 May 2026AY 2015-163 pages

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

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the penalty proceedings were vitiated because the Assessing Officer's show-cause notice under Section 271(1)(c) did not specify the limb under which the penalty was being levied. This procedural defect was considered fatal.

What were the facts?

The Revenue appealed an order that deleted a penalty levied under Section 271(1)(c) of the Income-tax Act. The Assessing Officer had initiated penalty proceedings for furnishing inaccurate particulars of income.

What were the issues?

Whether a penalty under Section 271(1)(c) is valid if the show-cause notice fails to specify the specific limb of the section invoked. Whether such a defect is procedural and curable or fatal to the proceedings.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 274

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “C’’ : NEW DELHI

Before: SH. YOGESH KUMAR US & SH. MANISH AGARWAL

For Respondent: Adv. & Sh. Vir Sain
Hearing: 19/03/2026Pronounced: 20/05/2026

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH “C’’ : NEW DELHI) BEFORE SH. YOGESH KUMAR US, JUDICIAL MEMBER AND SH. MANISH AGARWAL, ACCOUNTANT MEMBER ITA No.7690/DEL/2025 (AY 2015-16) DCIT, Vs. M/S AKC RETAILERS ARTO COMPLEX SECTOR-33 PRIVATE LIMITED, NOIDA, THIRD FLOOR, BHANOT UTTAR PRADESH-201301 CORNER, PAMPOSH ENCLAVE, GRETER KAILASH, SOUTH DELHI, NEW DELHI – 110 048 {PAN: AABCU0112B) (APPELLANT) (RESPONDENT)

Appellant by Sh. Dayainder Singh Sidhu, CIT(DR) Respondent by Sh. Rohit Kapoor, Adv. & Sh. Vir Sain Aggarwal, ITP

Date of hearing: 19/03/2026 Date of Pronouncement: 20/05/2026

ORDER PER MANISH AGARWAL, AM :

This Revenue’s appeal for assessment year 2015-16, arises

against the Commissioner of Income Tax (Appeals)-3 [in short, the

“CIT(A)”], Noida order dated 11.09.2025, involving proceedings

under section 271(1)(c) of the Income-tax Act, 1961 (hereinafter

referred to as ‘the Act’).

2.

At the threshold, it reveals during the course of

hearing that the AO has held that assessee has furnished

it’s inaccurate particulars of income to levy section

271(1)(c) penalty in question amounting to 1,10,49,260/-

vide Assessing Officer’s order dated 16.03.2022 which

was deleted by the Ld. CIT(A)’s in his detailed order dated

11.09.2025.

3.

At the time of hearing, ld. AR has raised its legal

argument that once the Assessing Officer had admittedly

issued his penalty show-cause notice(s) u/s 271(1)(c)

r.w.s. 274 of the Act dated 15th December, 2017, not

specifying any specific limb thereunder; and, his failure

to this effect vitiates the entire proceedings itself. The

Revenue on the other hand has vehemently argued that

such a defect is only a procedural one which is not fatal

to the impugned penalty.

4.

In view of the aforesaid facts and circumstances, we

quote the decision in the case of 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.) wherein, the Hon’ble Court has concluded that

once the Assessing Officer had nowhere specified the

corresponding limb in his section 271(1)(c) penalty show-

2 | P a g e

cause notice forming part of the case records, his failure

to this effect indeed vitiates the penalty proceedings

itself. Therefore, we do not find any infirmity in the order

of the Ld. CIT(A) and thus upheld the same.

5.

This Revenue’s appeal is dismissed.

Order pronounced in the Open Court on 20.05.2026. Sd/- Sd/- (YOGESH KUMAR US) (MANISH AGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER

SR Bhatnagar Date: 20.05.2026 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) ` 5. DR: ITAT ASSISTANT REGISTRAR ITAT DELHI

3 | P a g e

More judgments on Section 271(1)(c)

All 25,141 judgments and leading authorities on Section 271(1)(c) →

Latest GST High Court judgments

Search GST case law →