ASHOK KUMAR GROVER,DELHI V. ACIT CIRCLE-61(1),DELHI, DELHI

ITA 2893/DEL/2024

AI Insights

The case involves Sh. Ashok Kumar Grover, the appellant, contesting a penalty imposed by the ACIT, Circle 61(1), New Delhi, for the Assessment Year 2014-15. The penalty was initially levied on the grounds of concealment of income and furnishing inaccurate particulars of income. The appellant argued that the notice issued did not clearly specify whether the penalty was for concealment of income or for furnishing inaccurate particulars, which is a requirement under Section 271(1)(c) of the Income Tax Act. The Tribunal, referencing several judgments including those from the Supreme Court and the Delhi High Court, agreed with the appellant's contention and quashed the penalty proceedings.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 34419 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-10-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 28-10-2024
• Assessment Year: 2014-2015
• Appeal Filed On: 08-06-2024
• Other Referred Cases: Anand Kumar Jain Vs JCIT, PCIT Vs Shyam Sunder Jindal, PCIT Vs Golden Peace Hotels and Resorts (P) Limited
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJAY KUMAR
• Assessee Lawyers: SOMIL AGGARWAL
• Keywords: Initiation of penalty proceedings
• Section: 271(1)(c)

Judgement Text

"P a g e | 1 ITA No.2893/Del/2024 Sh. Ashok Kumar Grover Vs. ACIT, Circle 61(1) THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, DELHI BEFORE MS. MADHUMITA ROY, JUDICIAL MEMBER ITA No.2893/Del/2024 (Assessment Year 2014-15) Sh. Ashok Kumar Grover 19, Siri Fort Road New Delhi-110049 Vs. ACIT Circle 61(1) Delhi-110001 \u0001थायीलेखासं./जीआइआरसं./PAN/GIR No: AAGPG6935L Appellant .. Respondent Appellant by : Sh. Somil Aggarwal, Adv Respondent by : Sh. Sanjay Kumar, Sr. DR Date of Hearing 28.10.2024 Date of Pronouncement 30.10.2024 O R D E R PER MADHUMITA ROY, JM: The instant appeal filed by the assessee is directed against the order dated 10.04.2024 passed by the CIT(A) National Faceless Appeal Centre (NFAC), Delhi, arising out of the Penalty order dated 07.12.2021 passed by ACIT-61(1) New Delhi, Under Section 271(1)(c) of the Income Tax Act (hereinafter referred to as ‘the Act’) for Assessment Year 2014-15. 2. The matter relates to an order of penalty imposed on the assessee dated 29.11.2016 issued by the ACIT, Circle-6191), New Delhi, whereby and whereunder minimum penalty of Rs.2,85,105/- P a g e | 2 ITA No.2893/Del/2024 Sh. Ashok Kumar Grover Vs. ACIT, Circle 61(1) was levied upon the assessee on the ground of concealment of his income for the year under consideration. 3. At the time of hearing of the instant appeal the Learned Counsel for the assessee submitted before us that the Assessing Officer has initiated the proceedings by issuing notices dated 29.11.2016 on the alleged ground of concealment particulars of income and furnishing the inaccurate particulars of income as well, the copies whereof has been duly submitted before us. Further that while imposing penalty on 07.12.2021 Ld. AO alleged furnishing inaccurate particulars of income by the assessee as recorded therein. Under this fact and circumstances of the matter, he argued that recording of satisfaction by the Assessing Officer that there was concealment of income or furnishing inaccurate particulars of income by the assessee though sine qua non for initiation of penalty proceedings, the same has not been adhered to, rather the reasons first recorded on 29.11.2016 is on both the limbs. It is a settled principle of law that the Assessing Officer should issue notice against the assessee alleging violation of provision under Section 271(1)(c) of the Act and in this particular case the Assessing Officer was not sure while issuing show cause notice under Section 271(1)(c) of the Act whether he had to proceed on the basis of concealment of income or furnishing inaccurate particulars of the said income as is evident from the order dated 29.11.2016. The initiation of proceedings is violation of the prescribed provision under Section 271(1) (c) of the Act and thus P a g e | 3 ITA No.2893/Del/2024 Sh. Ashok Kumar Grover Vs. ACIT, Circle 61(1) liable to be quashed. In this regard she has relied upon many judgments passed by the different forum including the Coordinate Bench in the case of Anand Kumar Jain Vs JCIT in ITA No 1317 to 1322/Del/2023, the PCIT Vs Shyam Sunder Jindal, reported in 2023 156 taxmann.com625(Delhi) passed by the Hon’ble Delhi High Court and the judgment passed by the Hon’ble Apex Court in the case of PCIT Vs Golden Peace Hotels and Resorts (P) Limited, reported in (2021) 124 taxmann.com 249(SC). 4. Keeping in mind the fact of the matter, the judgments passed relied upon by the Learned AR have been duly considered by us which are found to be on the same line. In the judgment passed by the Hon’ble Supreme Court in the case of Golden Peace Hotels and Resorts(P) Limited (supra) that in the absence of specific recording by the Learned A.O. of satisfaction alleging either there was concealment of income or inaccurate particulars of income furnished by the assessee penalty proceedings ordered to be dropped by the Hon’ble High Court was upheld. 5. Further that in the case of CCIT Vs Shyam Sunder Jindal the Hon’ble High Court quashed the penalty proceedings initiated under Section 271(1)(c) in the absence of any specific limb under Section 271(1)(c) of the Act having been mentioned by the Assessing Officer in issuing the notice against the assessee. It is relevant to mention that the submission made by the Learned AR has not been able to be controverted conceal by the Learned DR neither the Learned DR P a g e | 4 ITA No.2893/Del/2024 Sh. Ashok Kumar Grover Vs. ACIT, Circle 61(1) able to rely upon any judgment contrary to the ratio laid down by the above forum as discussed herein above in support of the case made out for quashing of the penalty proceedings initiated against the assessee. 6. Thus having heard the Learned Counsel appearing for the parties, having regard to the facts and circumstances of the matter particularly the notice dated 29.11.2016 issued under Section 271(1)(c) of the Act by the ACIT, Circle-61(1) New Delhi without mentioning specific limb under that particular provision of law which is sine qua non for initiating penalty proceedings against the assessee as observed by the Hon’ble Apex Court, the said notice is found to be non-maintainable, invalid. Under this facts and circumstances of the matter the proceedings is also therefore, found to be void, ab-initio and thus quashed. 7. The assessee’s appeal is therefore allowed. Order pronounced in the open court on 30th October, 2024. Sd/- (MADHUMITA ROY) JUDICIAL MEMBER Dated: 30th October, 2024 Rohit P a g e | 5 ITA No.2893/Del/2024 Sh. Ashok Kumar Grover Vs. ACIT, Circle 61(1) Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi "