Jaina marketing & Associates, Delhi V. DCIT, Central Circle-18, Delhi

ITA 223/DEL/2023

AI Insights

The case involves appeals by Jaina Marketing & Associates against the consolidated order of CIT(A) -27, New Delhi, which upheld the penalty imposed by the Assessing Officer for the assessment years 2015-16 and 2016-17 under section 271(1)(c) of the Income Tax Act, 1961. The primary legal contention was the lack of specificity in the penalty notices issued by the Assessing Officer, which did not clearly state whether the allegations were for concealment of income or furnishing inaccurate particulars. The Tribunal referenced several judicial precedents, including decisions from the Karnataka High Court and the jurisdictional High Court, which supported the assessee's position that such non-specific notices do not validly initiate penalty proceedings.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 121980 (ITAT-DELHI)
• Duration Of Justice: 6 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-08-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 16-08-2023
• Assessment Year: 2016-2017
• Appeal Filed On: 30-01-2023
• Other Referred Cases: S.S.A Emerald Meadows (2016) 73 taxmann.com 241 (Kar.), PCIT vs. M/s Sahara India Life Insurance Company Ltd. & Other connected appeals, CIT vs. Manjunatha Cotton & gunning Factory 359 ITR 565 (Kar.)
• Laws Referred To: Income Tax Act 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANISH TIWARI
• Section: 271(1)(c); 274; 73

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: C: NEW DELHI BEFORE SHRI CHANDRA MOHAN GARG, JUDICIAL MEMBER AND DR. B.R.R. KUMAR, ACCOUNTANT MEMBER ITA Nos.222 & 223/Del/2023 Assessment Years: 2015-16 & 2016-17 Jaina Marketing & Associates, D-170, Okhla Industrial Area, Phase-1, Tehkhand, South East Delhi, Delhi 110020 PAN AADFJ 4417 D vs. The DCIT, Central Circle 18, Delhi (Appellant) (Respondent) For Assessee: Ms. Monika Agarwal, Adv. For Revenue : Shri Manish Tiwari, Sr. DR Date of Hearing : 17.08.2023 Date of Pronouncement : 30.08.2023 ORDER PER CHANDRA MOHAN GARG, J.M. 1. Captioned appeals have been filed against the consolidated order of CIT(A) -27, New Delhi dated 26.12.2022 for AY 2015-16 & 2016-17 by which the penalty imposed by the Assessing Officer u/s. 271(1)(c) of the I.T Act 1961 have been upheld. 2. The ld. counsel drawing our attention towards copies of the notices dated 02.06.2021 u/s. 274 r.w.s 271 of the I.T Act 1961 (for short the ‘Act’) for both the said assessment years, submitted that when the penalty proceedings have been initiated by the AO without specifying the allegation as to whether the assessee has conceal particulars of income or has furnished inaccurate particulars of income then the penalty cannot be held as valid and sustainable. The ld. counsel placed reliance on the judgment of Hon’ble Karnataka High Court in the case of S.S.A Emerald Meadows (2016) 73 taxmann.com 241 (Kar.) and judgment of Hon’ble jurisdictional High Court dated 02.08.2019 in ITA No. 475/2019 PCIT vs. M/s Sahara India Life Insurance Company Ltd. & Other connected appeals. ITA Nos.222 & 223/Del/2023 2 3. Replying to the above the ld. Senior DR supported the orders of the authorities below and submitted that the AO has rightly levied penalty u/s. 271(1)(c) of the Act by concluded that the assessee had conceal particulars of its income. 4. Copy of notices dated 02.06.2021 for AY 2015-16 & 2016-17 issued by the AO clearly reveals that the AO has not specify as to whether the assessee has conceal particulars of income or has furnished inaccurate particulars of income therefore the issue is squarely covered in favour of the assessee by the judgments of Hon’ble High Court of Karnataka in the cases of CIT vs. Manjunatha Cotton & gunning Factory 359 ITR 565 (Kar.) and in the case of CIT vs. S.S.A Emerald Meadows (supra). SLP of Department in the case of SSA Emerald Meadows (supra) has been dismissed by Hon’ble Supreme Court. Accordingly, AO is directed to delete the penalty. Sole grievance of assessee in both the appeals are allowed. 5. In the result, the appeals are allowed deleting the penalty. Order pronounced in the open court on 30.08.2023. Sd/- Sd/- (DR. B.R.R. KUMAR) (CHANDRA MOHAN GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 30 th August, 2023. NV/- Copy forwarded to : 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR // By Order // Asstt. Registrar, ITAT, New Delhi