SHRI ONKAR SINGH , JALANDHAR V. INCOME TAX OFFICER WARD-3, HOSHIARPUR

ITA 232/ASR/2018

AI Insights

The case involves an appeal by Sh. Onkar Singh against the order of the Commissioner of Income Tax (Appeals)-1, Jalandhar, which confirmed the levy of a penalty under section 271(1)(c) for the assessment year 2008-09. The primary contention was that the notice issued by the AO was defective as it failed to specify whether the penalty was for concealment of income or furnishing inaccurate particulars. The assessee argued that this defect was in violation of the principles laid down by the Hon'ble Apex Court and various High Courts, which require clear specification in penalty notices. The Tribunal, after considering the submissions and the cited precedents, agreed with the assessee and quashed the penalty.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 114469 (ITAT-AMRITSAR)
• Duration Of Justice: 4 year(s) 10 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 20-02-2023
• Assessment Year: 2008-2009
• Appeal Filed On: 19-04-2018
• Other Referred Cases: CIT & Anr. v. M/s SSA's Emrald Meadows, Manjunatha Cotton and Ginning Factory [2013] 359 ITR 565, Mohammad Farhan Akhtar v. DCIT 43 ITR 1
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 271(1)(c); 274; 43

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR BEFORE DR. M. L. MEENA, ACCOUNTANT MEMBER AND SH. ANIKESH BANERJEE, JUDICIAL MEMBER I.T. A. No. 232/Asr/2018 Assessment Year: 2008-09 Sh. Onkar Singh S/o Sh. Atma Singh VPO Sham Chaurasi, Hoshiarpur [PAN: DXSPS 2061F] (Appellant) V. Income Tax Officer, Ward-3, Hoshiarpur (Respondent) Appellant by : Sh. Y. K. Sud, CA Respondent by : Sh. Ravinder Mittal, Sr. DR Date of Hearing : 21.02.2023 Date of Pronouncement : 28.02.2023 ORDER Per Dr. M. L. Meena, AM: The present appeal has been filed by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals)-1, Jalandhar dated 30.03.2018 in respect of Assessment Year 2008-09. ITA No. 232/Asr/2018 Onkar Singh v. ITO 2 2. At the outset, the ld. counsel for the assessee submitted that the ld. CIT(A)-1, Jalandhar has dismissed the appeal of the assessee filed against the levy of penalty u/s 271(1)(c) vide order dated 30.03.2018 by passing a non speaking order and ignoring the judgment of Hon’ble Apex Court in Special Leave to Appeal (CC No. 11485/2016) arising out of impugned final judgment and order dated 23.11.2015 in ITA No. 380/2015 passed by the Hon’ble High Court of Karnataka at Bengaluru in the case of CIT & Anr. v. M/s SSA’s Emrald Meadows (APB pgs. 4 to 8), that the assessee’s appeal is squarely covered by the judgment of Hon’ble Apex Court because the AO issued a defective notice u/s 274 r.w.s. 271(1)(c) of the Income Tax Act, 1961 for assessment year 2008-09 wherein he did not specify under which limb of section 271(1)(c) of the Act, the penalty proceedings had been initiated i.e., whether for concealment of particulars of income or furnishing of inaccurate particulars of income. Photocopy of the notice issued u/s 274 r.w.s. 271(1)(c) of the Act (APG pg. 9) is reproduced as under: ITA No. 232/Asr/2018 Onkar Singh v. ITO 3 ITA No. 232/Asr/2018 Onkar Singh v. ITO 4 3. The counsel has further placed the reliance on the judgment of Hon’ble Karnataka High Court in the case of Manjunatha Cotton and Ginning Factory [2013] 359 ITR 565 and the latest judgment of Hon’ble Bombay High Court in the case of Mohammad Farhan Akhtar v. DCIT 43 ITR 1. 4. The ld. DR stand by the order of the ld. CIT(A), however, he failed to file any submission or citation in rebuttal to the contention raised by the ld. counsel. 5. Having heard both the sides, perusal of material on record and case law cited before us, it is admitted fact that the AO issued a defective notice u/s 274 r.w.s. 271(1)(c) of the Income Tax Act, 1961 for assessment year under consideration without specifying the limb of the section for initiating the penalty proceedings as evident from the notice as above. It is well settled law by the higher judicial forum that the levy of penalty on the basis of defective notice issued u/s 274 r.w.s. 271(1)(c) of the Income Tax Act is liable to be bad in law. In the instant case, the AO did not specify under which limb of section 271(1)(c) of the Act, the penalty proceedings had been initiated, i.e., whether for concealment of particulars of income or furnishing inaccurate particulars of income. Thus, such a technical error ITA No. 232/Asr/2018 Onkar Singh v. ITO 5 reveal non application of mind by the AO in initiating and levying penalty u/s 271(1)(c). 6. Accordingly, we hold that the order of the CIT(A)-1, Jalandhar confirming the levy of penalty u/s 271(1)(c) is illegal and bad in law. Hence, it is liable to be quashed. Accordingly, the penalty levied u/s 271(1)(c) is hereby deleted. 7. In the result, appeal of the assessee is allowed. Order pronounced in the open court on 28.02.2023 Sd/- Sd/- (Anikesh Banerjee) (Dr. M. L. Meena) Judicial Member Accountant Member *GP/Sr./P.S.* Copy of the order forwarded to: (1)The Appellant (2) The Respondent (3) The CIT (4) The CIT (Appeals) (5) The DR, I.T.A.T. True Copy By Order