ASHOK KUMAR,NEW DELHI vs. ACIT, CIRCLE-36(1), NEW DELHI

PDF · subscribers
ITA 204/DEL/2020Status: DisposedITAT Delhi23 May 2023AY 2013-143 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 notice under Section 274 must specifically state the grounds for imposing penalty under Section 271(1)(c). An omnibus notice is vague and bad in law, as per various High Court judgments.

What were the facts?

The assessee appealed against an order of the CIT(A). The penalty order and assessment order did not specify whether the penalty under Section 271(1)(c) was for concealment of income or furnishing inaccurate particulars.

What were the issues?

Whether a penalty notice under Section 274 is valid if it does not specifically state the grounds for penalty under Section 271(1)(c)?

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(3)Show list

Detected automatically from the text. Citations are also linked where they appear in the judgment. The count shows how many other judgments on BharatTax rely on the same authority.

Income Tax Appellate Tribunal, DELHI BENCH ‘A’, NEW DELHI

Before: Dr. B. R. R. KumarSh. Yogesh Kumar US

Hearing: 27.02.2023Pronounced: 23.05.2023

Per Dr. B. R. R. Kumar, Accountant Member:

1.

The present appeal has been filed by the assessee against the order of ld. CIT(A)-23, New Delhi dated 27.11.2019.

2.

Neither the Assessment Order nor the penalty order specified invocation of the specific limb of the penalty u/s 271(1)(c), either concealment or furnishing of inaccurate particulars of income has been specified. On this issue, we are guided by the following judgments:

1) Karnataka High Court: CIT vs. Manjunatha Cotton and Ginning Factory: 359 ITR 565 held that notice under section 274 should specifically state the grounds mentioned in section 271(1)(c) of the Act, i.e., whether it is for concealment of income or for furnishing of incorrect particulars of income. Sending printed form where all the Ashok Kumar grounds mentioned in section 271 are mentioned would not satisfy requirement of law.

2) Bombay High Court: Mr. Mohd. Farhan A. Shaikh Vs ACIT Section 271(1)(c): Penalty-Concealment-Non-striking off of the irrelevant part while issuing notice u/s 271(1)(c) of the Income Tax Act, order is bad in law. Assessee must be informed of the ground of the penalty proceedings only through statutory notice. An omnibus notice suffers from the vice of vagueness.

3) The Hon’ble jurisdictional Delhi High Court in the case of PCIT vs. Sahara India Life Insurance Co. Ltd. in of 2019, reiterated that notice under section 274 should specifically state the grounds on which penalty was sought to be imposed as the assessee should know the grounds which he has to meet specifically.

4) The aforesaid principle has been reiterated in the in the case of CIT vs. SSA'S Emerald Meadows: 73 taxmann.com 241 (Kar) [Revenue’s SLP dismissed in 242 Taxman 180]

3.

Hence, respectfully following the order of the Hon’ble Jurisdictional High Court, the penalty levied is hereby obliterated.

Ashok Kumar 4. In the result, the appeal of the assessee is allowed. Order Pronounced in the Open Court on 23/05/2023.

More judgments on Section 271(1)(c)

All 25,141 judgments and leading authorities on Section 271(1)(c) →

Recent GST High Court judgments

Search GST case law →