G. VANITHA,BANGALORE vs. ITO, BANGALORE

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ITA 639/BANG/2014Status: DisposedITAT Bangalore24 June 2016AY 2006-073 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that while a vague notice could invalidate a penalty, this specific ground was not raised before the CIT(A). Therefore, the issue was remitted back to the CIT(A) for consideration.

What were the facts?

The assessee appealed against a penalty levied under Section 271(1)(c) of the Income-tax Act. A key ground of appeal was the alleged vagueness of the notice issued by the Assessing Officer for the penalty.

What were the issues?

The primary issue was whether a vague penalty notice issued under Section 274 read with Section 271(1)(c) invalidates the penalty, and whether this issue could be raised for the first time before the Tribunal.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 274

AI-generated summary — verify with the full judgment below

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Income Tax Appellate Tribunal, BANGALORE BENCH C, BANGALORE

For Appellant: Shri. Ravishankar S. V, Advocate

O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER :

In this appeal filed by assessee, it assails levy of penalty of Rs.5,24,090/-, u/s.271(1)(c) of the Income-tax Act, 1961 (‘the Act’ in short).

ITA.639/Bang/2014 Page - 2

2.

Among the very many grounds taken by the assessee, one of the grounds, namely ground no.3(c) assails that the validity of the notice issued by the AO u/s.271(1) r.w.s.274 of the Act. Learned Counsel for the Assessee submitted that the notice was vague and by virtue of the judgment of Hon’ble jurisdictional High Court in the case of CIT v. M/s. Manjunatha Cotton & Ginning Factory (359 ITR 565), a vague notice would invalidate the levy of penalty.

3.

Ld. DR on the other hand submitted that this ground was not taken by the assessee before the CIT (A).

4.

We have perused the orders and heard the contentions. It might be true that Hon’ble jurisdictional High Court in the case of Manjunatha Cotton & Ginning Factory (supra) had emphasised the requirement of specifying the alleged failure of the assessee in the notice issued u/s.274 read with section 271(1)(c) of the Act. Nevertheless we find that such a ground was never raised before the CIT (A). In the fitness of things, we are of the opinion that the issue regarding validity of penalty due to vagueness of the notice issued u/s.274 r.w.s.271 of the Act has to be considered by the CIT (A). We therefore remit this issue to the CIT (A) for consideration in accordance with law.

ITA.639/Bang/2014 Page - 3

5.

In the result, appeal of the assessee is treated as allowed for statistical purpose.

Order pronounced in the open court on 24th day of June, 2016.

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