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Facts
The Revenue appealed against an order upholding a penalty under section 271(1)(c) for allegedly furnishing inaccurate particulars of income. The assessee's appeal proceeded ex-parte as none appeared on their behalf.
Held
The Tribunal held that the penalty show-cause notice issued by the Assessing Officer was vitiated because it failed to specify the particular limb of section 271(1)(c) under which the penalty was proposed. This defect was considered fatal to the penalty proceedings.
Key Issues
Whether the failure of the Assessing Officer to specify the limb of section 271(1)(c) in the penalty show-cause notice vitiates the penalty proceedings.
Sections Cited
271(1)(c), 274
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IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: 'F' NEW DELHI
BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI NAVEEN CHANDRA, ACCOUNTANT MEMBER
ITA No.4494/Del/2019 Assessment Year: 2013-14
Income Tax Officer, Ward-18(1), | Vs. Neminath Industries Pvt. Ltd., I-G, 1st Floor, Bharat Nagar, New Delhi | New Friends Colony, New Delhi PAN: AAACR3132K (Appellant) | (Respondent)
Assessee by | None Department by | Ms. Harpreet Kaur Hansra, Sr. DR
Date of hearing | 03.02.2026 Date of pronouncement | 03.02.2026
ORDER
PER SATBEER SINGH GODARA, JM
This Revenue's appeal for assessment year 2013-14, arises against the Commissioner of Income Tax (Appeals)-36 [in short, the "CIT(A)"], New Delhi's order dated 12.02.2019 passed in case no. 117/18-19, involving proceedings under section 271(1)(c) of the Income-tax Act, 1961 (hereinafter referred to as 'the Act').
Case called twice. None appears at the assessee/respondent's behest. It is accordingly proceeded ex-parte.
- 2. It emerges at the outset during the course of hearing that both the learned lower authorities have held the assessee to have furnished it's inaccurate particulars of income to levy section 271(1)(c) penalty in question amounting to 1,04,60,750/- vide Assessing Officer's order dated 12.03.2018 which stands upheld in the CIT(A)'s detailed discussion. - 3. The assessee has first of all raises it's legal argument that once the learned Assessing Officer had admittedly issued his penalty show-cause notice(s) u/s 271(1)(c) r.w.s. 274 of the Act dated 14th March, 2013, 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. Faced with this situation, we quote 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.) to conclude that once the learned Assessing Officer
had nowhere specified the corresponding limb in his section 271(1)(c) penalty show-cause notice forming part of the case records, his failure to this clinching effect indeed vitiates the penalty proceedings itself. Quashed accordingly.
This Revenue's appeal is dismissed.
Order pronounced in the open court on 3rd February, 2026
ACCOUNTANT MEMBER JUDICIAL MEMBER
Sd/- Sd/- (NAVEEN CHANDRA) (SATBEER SINGH GODARA)
Dated: 27th February, 2026.
RK/-
Copy forwarded to:
- 1. Appellant - 2. Respondent - 3. CIT - 4. CIT(A) - 5. DR
Asst. Registrar, ITAT, New Delhi