GAG CONSTRUCTION PVT. LTD.,NEW DELHI vs. ACIT, CENTRAL CIRCLE- 32, NEW DELHI

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ITA 289/DEL/2018Status: DisposedITAT Delhi12 July 2018AY 2006-073 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 show cause notice was invalid as it did not specify whether the penalty proceedings were initiated for concealment of income or furnishing inaccurate particulars of income. Consequently, the penalty proceedings were vitiated.

What were the facts?

The assessee's appeal challenged the penalty levied under section 271(1)(c) of the Income Tax Act for the Assessment Year 2006-2007. The penalty was imposed based on a show cause notice issued by the Assessing Officer.

What were the issues?

The key issue was the validity of the penalty proceedings due to a vague show cause notice that failed to specify the limb of Section 271(1)(c) under which the penalty was being levied.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 274

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

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Income Tax Appellate Tribunal, DELHI BENCHES “SMC” : DELHI

Before: SHRI BHAVNESH SAINI

Hearing: 12.07.2018Pronounced: 12.07.2018

Date of Hearing : 12.07.2018 Date of Pronouncement : 12.07.2018 ORDER

This appeal by assessee has been directed against the Order of the Ld. CIT(A)-30, New Delhi, dated 21.11.2017, for the A.Y. 2006-2007, challenging the levy of penalty under section 271(1)(c) of the I.T. Act, 1961, in a sum of Rs.3,619/-.

2.

I have heard the learned Representatives of both the parties and perused the material on record.

2 ITA.No.289/Del./2018 GAG Construction Pvt. Ltd., New Delhi.

3.

Learned Counsel for the Assessee filed copy of the show cause notice issued by A.O. before levy of the penalty under section 274 r.w.s. 271 of the I.T. Act, dated 24.12.2010 in which the A.O. has mentioned as under :

“have concealed the particulars of your income or furnished inaccurate particulars of such income or have concealed the particulars of the fringe benefits or furnished inaccurate particulars of such fringe benefits.”

3.1. The aforesaid show cause notice is invalid and bad in law because the same did not specify for which limb of Section 271(1)(c) of the Act, the penalty proceedings had been initiated i.e., whether for concealment of particulars of income or furnishing inaccurate particulars of income. It would, therefore, vitiate the entire penalty proceedings. I rely upon the decision of Hon’ble Karnataka High Court in the case of CIT vs. M/s.

SSAs Emerald Meadows 73 taxmann.com 241, which is confirmed by the Hon’ble Supreme Court reported in 73

3 ITA.No.289/Del./2018 GAG Construction Pvt. Ltd., New Delhi. taxmann.com 248. In this view of the matter, the orders of the authorities below are set aside and penalty is cancelled.

4.

In the result, appeal of assessee is allowed.

Order pronounced in the open Court.

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