UNIPATCH RUBBER LIMITED,DELHI vs. DCIT/ACIT, CIRCLE 25(1), DELHI, DELHI

सुनवाईक�तारीख/ Date of hearing: 10.12.2025 10.12.2025 उ�ोषणाक�तारीख/Pronouncement on आदेश /O R D E R PER SANJAY AWASTHI, ACCOUNTANT MEMBER:

1.1 The aggrieved assessee has approached the ITAT with grounds of appeal which challenge the impugned penalty on the basis of the merit surrounding the additions and more importantly on the basis of the fact that the Ld. AO did not strike off the portion where he had to choose between “inaccurate particulars” and “concealment of income”. To this extent the ground no.2 of the assessee has been placed before us for consideration as under:

2. That the Ld. National Faceless Appeal Centre/Commissioner of Income Tax (Appeals) has further erred both in law and on facts, in not setting aside the penalty order dated …..being the penalty proceedings initiated u/s 271(1)(c ) are vitiated ab initio due to issuance of a vague and ambiguous show cause notice dated 29.06.2023 u/s 274 r.w.s. 271(1)(c ) of the Act, without striking off the irrelevant portion and without clearly specifying whether the penalty was being levied for concealment of income or for furnishing inaccurate particulars of income, thereby violating the principles laid down in judicial precedents.

2. Before us the Ld. AR pointed out the facts through a Paper book running into 77 pages and brought to our notice that the first notice u/s 274 of the Act dated 17.03.2020 mentioned both aspects of triggers for levying a penalty u/s 271(1)(c) of the Act. It was further pointed out that another notice u/s 274 of the Act dated 29.06.2023 also mentioned both these aspects. It was pointed out that ultimately the penalty was levied on the basis of “inaccurate particulars”. The Ld. AR relied on the case of PCIT vs. Unitech Reliable Projects Pvt. Ltd. reported in [2024] 462 ITR 307 (Del.). It was pointed out that this matter travelled up to the Hon’ble Supreme Court where the SLP was also dismissed [469 ITR 394] (SC). The Ld. AR read out from various portions of this judgment.

2.1 The Ld. DR relied on the orders of the authorities below.

“Section 271(1)(c), read with section 274, of the Income Tax Act, 1961 – Penalty – For concealment of income (Scope of provision) – Assessment year 2012-13 – Whether where Assessing Officer had triggered penalty proceedings u/s 271(1)(c ) against assessee, it was necessary for him to indicate broadly as to limb under which penalty proceedings were triggered – Held, yes – Assessing Officer made additions to assessee’s income and triggered penalty proceedings u/s 271(1)(c ) and further levied penalty – Tribunal having found that notice issued u/s 274 did not specify as to limb under which penalty was sought to be imposed, i.e., notice did not indicate as to whether penalty was to be levied on account of concealment of income or for reason that assessee had furnished inaccurate particulars quashed penalty proceedings – Whether no substantial question of law arose for consideration – Held, yes [Para 26].” Considering the clear directive contained in the said case law the impugned penalty is directed to be deleted.

Order pronounced in the open court on 10.12.2025