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Income Tax Appellate Tribunal, DELHI BENCHES “E”: DELHI
Before: SHRI BHAVNESH SAINI & SHRI O.P. KANT
Date of Hearing : 23.01.2020 Date of Pronouncement : 28.01.2020 ORDER PER BHAVNESH SAINI, J.M.
This appeal by Assessee has been directed against the Order of the Ld. CIT(A)-20, New Delhi, Dated 08.10.2015, for the A.Y. 2009-2010, challenging the levy of penalty under section 271(1)(c) of the I.T. Act, 1961.
We have heard the Learned Representatives of both the parties.
2 ITA.No.6575/Del./2015 Shri Sachinder Mohan Mehta, New Delhi.
The assessee has moved an application for admission of additional grounds of appeal challenging that notice issued under section 274 r.w.s. 271(1)(c) of the Act being defective and invalid and no penalty could be levied against the assessee. Learned Counsel for the Assessee submitted that it is a legal ground based on the material on record, therefore, same may be admitted for hearing. He has relied upon Judgment of the Hon’ble Supreme Court in the case of NTPC vs., CIT 229 ITR 383 (SC).
4. After considering the rival submissions, we are of the view that additional ground is legal in nature and based on material on record, therefore, same is admitted for hearing. Learned Counsel for the Assessee placed on record copy of the notice issued before levy of the penalty dated 09.12.201, 31.05.2012 and 07.02.2014 in which the A.O. has similarly mentioned “have concealed the particulars of your income or furnished inaccurate particulars of such income.” Thus, the Department has been regularly issuing such notice to the assessee without specifying as to whether assessee has furnished inaccurate particulars of income or 3 ITA.No.6575/Del./2015 Shri Sachinder Mohan Mehta, New Delhi. concealed the particulars of income. Learned Counsel for the Assessee, therefore, submitted that issue is covered by the Judgment of the Hon’ble Delhi High Court in the case of Pr. CIT vs., M/s. Sahara India Life Insurance Company Ltd., vide Order Dated 02.08.2019, reported in 2019 (8) TMI 409 (Del.), in which in paras 21 and 22, the Hon’ble Delhi High Court held as under :
“21. The Respondent had challenged the upholding of the penalty imposed under Section 271(1) (c) of the Act, which was accepted by the IT AT. It followed the decision of the Karnataka High Court in CIT v. Manjunatha Cotton & Ginning Factory 359 ITR 565 (Kar) and observed that the notice issued by the AO would be bad in law if it did not specify which limb of Section 271(1)(c) the penalty proceedings had been initiated under i.e. whether for concealment of particulars of income or for furnishing of inaccurate particulars of income. The Karnataka High Court had followed the above judgment in the subsequent order in Commissioner
4 ITA.No.6575/Del./2015 Shri Sachinder Mohan Mehta, New Delhi. of Income fax v. SSA’s Emerald Meadows (2016) 73 Taxman.com 241 (Kar), the appeal against which was dismissed by the Supreme Court of India in SLP No.11485 of 2016 by order dated 5th August, 2016.
On this issue again this Court is unable to find any error having been committed by the ITAT. No substantial question of law arises”.
On the other hand, the Ld. D.R. relied upon the Orders of the authorities below and relied upon Order of ITAT, Chennai Bench in the case of ITO vs., Rajan Kalimuthu TS-289-ITAT-2019(CHNY) and Sundaram Finance Ltd., [2018] 403 ITR 407 (Madras), against which, the SLP filed by the Department have been dismissed.
6. After considering the rival submissions, we are of the view that the penalty is not leviable in the matter. In this case, the A.O. issued show cause notices for levy of penalty under section 271(1)(c) of the Act which is bad in law as it did not specify in which limb of Section 271(1)(c) of 5 ITA.No.6575/Del./2015 Shri Sachinder Mohan Mehta, New Delhi. the Act, the penalty proceedings had been initiated i.e., whether for concealment of particulars of income or furnishing inaccurate particulars of income. The entire penalty proceedings are, therefore, vitiated and no penalty is leviable. On this score itself similar view is taken by Hon’ble Karnataka High Court in the case of CIT vs. M/s. SSA’s Emerald Meadows 73 taxmann.com 241 (Kar.). This decision is confirmed by the Hon’ble Supreme Court reported in 242 Taxman 180 (SC). Further, the Hon’ble Delhi High court recently in the case of Pr. CIT vs. M/s. Sahara India Life Insurance Company Ltd., (supra) following the decision of Hon’ble Supreme Court in the case of M/s. SSA’s Emerald Meadows (supra) confirmed cancellation of the penalty. We, therefore, following the aforecited decisions of the Hon’ble Delhi High Court in the case of Pr. CIT vs. M/s. Sahara India Life Insurance Company Ltd., (supra), set aside the Orders of the authorities below and cancel the penalty.
In the result, appeal of assessee allowed.
6 ITA.No.6575/Del./2015 Shri Sachinder Mohan Mehta, New Delhi. Order pronounced in the open Court.