M/S MELTING POINT,KOLHAPUR vs. ACIT, CIRCLE-1, KOLHAPUR

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ITA 2118/PUN/2019Status: DisposedITAT Pune16 June 2022AY 2011-122 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 failure of the Assessing Officer to specify the limb under which the penalty was being levied in the show-cause notice is fatal to the proceedings. Therefore, the penalty imposed was not sustainable in law.

What were the facts?

The assessee's appeal for AY 2011-12 was against a penalty imposed under Section 271(1)(c) of the Income Tax Act. The Assessing Officer's show-cause notice did not specify whether the penalty was for concealment of income or furnishing inaccurate particulars.

What were the issues?

Whether a penalty under Section 271(1)(c) is valid if the show-cause notice fails to specify whether it is for concealment of income or furnishing inaccurate particulars.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

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Income Tax Appellate Tribunal, “B” BENCH,

Before: SHRI S.S.GODARA & DR.DIPAK P.RIPOTE

For Respondent: Shri S P Walimbe – DR
Hearing: 10/06/2022Pronounced: 16/06/2022

ORDER

Per S.S.Godara, JM:

1.

This Assessee’s appeal for A.Y.2011-12 is directed against the Commissioner of Income Tax(Appeals)-1, Kolhapur’s order dated 01.11.2019 in Appeal No.KOP/433/2014-15 in proceedings u/s.271(1)(c) of the Income Tax Act, 1961, in short “the Act”.

Case called twice. None appears at the assessee’s behest. It is accordingly proceeded ex-parte.

2.

It emerges at the outset that we hardly need to delve deeper in the relevant factual matrix so far as the correctness of the impugned section 271(1)(c) of the Act, penalty of Rs.2,23,768/- imposed in both the lower proceedings is concerned. This for the reason that a perusal of the A.Y. 2011-12 Melting Point vs. ACIT (A)

Assessing Officer’s corresponding show-cause notice dated 05.12.2013 issued to the assessee nowhere specified as to whether it had concealed the particulars of income or furnished inaccurate particulars of such income. This clinching fact has gone unrebutted from the revenue’s side.

3.

Faced with the situation, we quote hon’ble jurisdictional high court’s recent Full Bench decision in Mohd. Farhan A Shaikh vs. ACIT [2021] 434 ITR 1 (Bom) that such a failure in Assessing Officer’s part in not specifying the corresponding limb in the penalty show cause notice itself is very much fatal to the entire process and not sustainable in law. We adopt the very reasoning herein as well to delete the impugned penalty for this precise reason alone.

4.

This assessee’s appeal is allowed on above terms. Order pronounced in the open Court on 16th June, 2022.

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