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Income Tax Appellate Tribunal, “B” BENCH, PUNE
Before: SHRI R.S.SYAL, VP & SHRI PARTHA SARATHI CHAUDHURY, JM
आदेश / ORDER
PER PARTHA SARATHI CHAUDHURY, JM :
This appeal preferred by the assessee emanates from the order of the Ld. CIT(Appeals), Pune dated 23.12.2016 for the assessment year 2011-12 as per grounds of appeal on record.
2 ITA No.1185 /PUN/2017 A.Y.2011-12
The crux of the grievance of the assessee is with regard to confirmation
of penalty levied u/s.271(1)(c) of the Income Tax Act, 1961 (hereinafter
referred to as ‘the Act’).
The brief facts in this case are that the assessee is a salaried individual who derives salary from (i) Eaton Technologies Pvt. Ltd (ii) Hutchison 3 Global Services Pvt. Ltd (iii) Axa Technologies Shares Services Pvt. Ltd. The Assessment u/s. 143(3) was completed on 29.03.2014 assessing total taxable income of Rs.39,89,650/-. The case was selected for scrutiny as per the Scrutiny
Selection Norms under CASS and the required notices duly issued and served on the Assessee. Penalty was initiated in the assessment Order for furnishing
inaccurate particulars and concealment of income for the failure of the Assessee to offer Rs.4,54,653/- and Rs.1,71,721/- salary received from two concerns, failure to disclose interest amount of Rs.8,121/- and to explain the source of cash deposits amounting to Rs.32,50,000/-.
At the time of hearing the Ld. AR of the assessee at the very outset
submitted that the notice issued u/s.274 r.w.s.271(1)(c) of the Act along with
penalty order is vague as to the limb on which penalty u/s. 271(1)(c) of the
Act is initiated. The Ld. AR contended that it is settled principle of law if the
charge is not specific then the penalty u/s.271(1)(c) of the Act cannot be
levied. That in support of his contentions, the Ld. AR of the assessee relied on
the decision of Hon'ble Jurisdictional High Court in the case of CIT Vs.
Samson Perinchery in ITA No.1154 of 2014 and the decision of Hon'ble
Karnataka High Court in the case of CIT Vs. Manjunath Cotton and Ginning
Factory reported as 359 ITR 565. The Ld. AR further submitted that the
assessee has filed revised return on 18.12.2013 in compliance to section
139(5) of the Act. Since revised return was filed before assessment was
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completed i.e. on 29.03.2014 and in that revised return, the assessee has
reflected the salary and the interest component which was not included in the
original return and thereby in compliance to section 139(5) of the Act, there is
neither ‘concealment of income’ nor ‘furnishing of inaccurate particulars of
income’ so far as the assessee is concerned.
Per contra, the Ld. DR has relied on the orders of Sub-ordinate
Authorities.
We have perused the case records and considered the judicial
pronouncement placed before us. The facts reveal that in the notice issued
u/s.274 r.w.s. 271(1)(c) of the Act as well as penalty order, the charge for
which penalty u/s.271(1) (c) of the Act has been levied, is not specific and
both the limbs of charge are mentioned there i.e. ‘concealment of income’ and
‘furnishing of inaccurate particulars of income’.
That taking guidance from the decision of the Hon'ble Bombay High
Court in the case of CIT Vs. Samson Perinchery (supra.) wherein the Hon'ble
Bombay High Court has considered the decision of Hon'ble Karnataka High
Court in the case of CIT Vs. Manjunath Cotton and Ginning Factory (supra.),
the legal proposition that comes out and which is binding in nature is that
the Assessing Officer should be clear as to which of the two limbs under
which penalty is imposable, has been contravened or indicate that both have
been contravened while initiating penalty proceedings. It cannot be that the
initiation would be only on one limb i.e. for furnishing inaccurate particulars
of income while imposition of penalty on the other limb i.e. concealment of
income.
The sanctity in terms of natural justice with regard to this proposition
is that the assessee under the scheme of welfare legislation which is
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embedded in the Income Tax Act, 1961 should get an opportunity to prepare himself for the defense as regards to the exact charge on which penalty is imposed upon him u/s. 271(1)(c) of the Act. In the instant case, the charge is vague and therefore, levy of penalty is not warranted. Furthermore, the revised return filed by the assessee is in conformity with section 139(5) of the Act wherein all the particulars of income have been disclosed.
Taking totality of facts and legal scenario into consideration, we set aside the order of the Ld. CIT(Appeals) and direct the Assessing Officer to delete the penalty from the hands of the assessee.
In the result, appeal of the assessee is allowed.
Order pronounced on 26th day of March, 2019.
Sd/- Sd/- R.S.SYAL PARTHA SARATHI CHAUDHURY VICE PRESIDENT JUDICIAL MEMBER
पुणे / Pune; �दनांक / Dated : 26th March, 2019. SB आदेश क� ��त�ल�प अ�े�षत / Copy of the Order forwarded to :
अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The CIT(Appeals), Pune-5. 4. The Pr. CIT, Pune-4, Pune. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, “बी” ब�च, 5. पुणे / DR, ITAT, “B” Bench, Pune. गाड� फ़ाइल / Guard File. 6.
// True Copy // आदेशानुसार / BY ORDER,
�नजी स�चव / Private Secretary आयकर अपील�य अ�धकरण, पुणे / ITAT, Pune.
5 ITA No.1185 /PUN/2017 A.Y.2011-12
Date 1 Draft dictated on 25.03.2019 Sr.PS/PS 2 Draft placed before author 26.03.2019 Sr.PS/PS 3 Draft proposed and placed JM/AM before the second Member 4 Draft discussed/approved by AM/JM second Member 5 Approved draft comes to the Sr.PS/PS Sr. PS/PS 6 Kept for pronouncement on Sr.PS/PS 7 Date of uploading of order Sr.PS/PS 8 File sent to Bench Clerk Sr.PS/PS 9 Date on which the file goes to the Head Clerk 10 Date on which file goes to the A.R 11 Date of dispatch of order