VEENA KOTHARI,KOLKATA vs. DCIT, CIR-44, KOLKATA, KOLKATA

O R D E R

Per Dr. Arjun Lal Saini, AM:

2. For that the ld. CIT(A) ought to have appreciated the factual aspect of the case and the submissions made by the appellant in the course of hearing and ought not to have confirmed the levy of penalty imposed by the AO u/s 271(1)(c).

3. For that the ld. CIT(A) ought to have held that the proceedings initiated u/s u/s 271(1)(c) by the AO by way of notice issued by him Veena Kothari Assessment Year: 2007-08 were wrong and as such the levy of penalty of Rs.31,780/- was totally wrong and uncalled for. 4. For that further grounds of appeal may kindly be allowed to be taken at the time of hearing of appeal.”

3. At the outset itself, the Ld. Counsel for the assessee drew our attention to the notice u/s. 274 of the act r.w.s. 271 of the Act dated 30.12.2009 served on the assessee wherein we note that the AO has not struck down the limb of charge/default for which the penalty is being initiated against the assessee. We find that the notice has been issued for having concealed the particulars of income or furnished inaccurate particulars of such income. We note that in a similar case the Hon’ble High court of Karnataka in the case of CIT vs Manjunatha Cotton and Ginning Factory reported in (2013) 359 ITR 565 (Kar) has cancelled the penalty taking note of the fact that the penalty notice did not spell out clearly as to whether the assessee has concealed the particulars of income or has furnished inaccurate particulars of Income. We also find that Hon’ble Karnataka High Court in the case of CIT Vs. SSA’s Emerald Meadows, reported in (2016) 73 taxmann.com 241 (Kar) endorsed the same view in Manjunatha Cotton and Ginning Factory(supra) and held as under: “3. The Tribunal has allowed the appeal filed by the assessee holding the notice issued by the Assessing Officer under section 274 read with Section 271(1)(c) of the Income Tax Act, 1961 (for short ‘the Act’), to be bad in law as it did not specify 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 of inaccurate particulars of income. The Tribunal, while allowing the appeal of the assessee, has relied on the decision of the Division Bench of this Court rendered in the case of CIT Vs. Manjunatha Cotton & Ginning Factory (2013) 359 ITR 565/218 Taxman 423/35 taxmann.com 250(Kar).