Assistant Commissioner of Income Tax, Circle-1(1), Visakhapatnam V. Chilukuri Housing Projects Private Limited, Visakhapatnam

ITA 243/VIZ/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 6318 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 7 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-01-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 28-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V APPALA RAJU
• Keywords: Principle of natural justice; Question of law
• Section: 271(1)(c); 143(3); 133A; 27

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH, VISAKHAPATNAM BEFORE SHRI V. DURGA RAO , HONBLE JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH , HONBLE ACCOUNTANT MEMBER ITA NO. 243 / VIZ /201 8 (ASST. YEAR : 20 11 - 1 2 ) ACIT, CIRCLE - 1(1), VISAKHAPATNAM. V S . M/S. CHILUKURI HOUSING PROJECTS PVT. LTD., 9 - 21 - 17/2, GROUND FLOOR, STREET NO. 21, CBM COMPOUND, VISAKHAPATNAM. PAN NO. AADCC 1027 D (APPELLANT) (RESPONDENT) C.O.NO. 47/VIZ/2018 (ARISING OUT OF ITA NO. 243 / VIZ /201 8) (ASST. YEAR : 20 11 - 12 ) M/S. CHILUKURI HOUSING PROJECTS PVT. LTD., 9 - 21 - 17/2, GROUND FLOOR, STREET NO. 21, CBM COMPOUND, VISAKHAPATNAM. VS . ACIT, CIRCLE - 1(1), VISAKHAPATNAM. PAN NO. AADCC 1027 D (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI G.V.N. HARI ADV OCATE . DEPARTMENT BY : SHRI V. APPALA RAJU SR. DR DATE OF HEARING : 03 / 01 /201 9 . DATE OF PRONOUNCEMENT : 25 / 0 1 /201 9 . O R D E R PER V. DURGA RAO, JUDICIAL MEMBER TH IS APPEAL FILED BY THE REVENUE AND THE CROSS OBJECTION FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF 2 ITA NO. 243/VIZ/2018 & C.O.NO. 47/VIZ/2018 ( M/S. CHILUKURI HOUSING PROJECTS PVT. LTD. ) COMMISSIONER OF INCOME TAX (APPEALS) - 1 , VISAKHAPATNAM PASSED IN ITA N O . 1032/ 2014 - 15/DCIT, C - 3(1), VSP/2017 - 18 , DATED 22 /0 3 /201 8 FOR THE ASSESSMENT YEAR 200 9 - 10 . 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1. THE ORDER OF THE LD. CIT(A) - 1, VISAKHAPATNAM IS ERRONEOUS IN LAW. 2. THE LD.CIT(A) - 1, VISAKHAPATNAM ERRED IN DELETING THE PENALTY OF RS.92,31 , 310/ - LEVIED U/S 271(L)(C) OF THE INCOME TAX ACT, 1961 IGNORING AND NOT APPRECIATING THE DECISIONS OF THE HON'BLE HIGH COURT OF ANDHRA PRADESH IN THE CASES OF CIT VS CHANDULAL (152 ITR 238) AND SRINIVASA PITTY & SONS VS CIT (173 ITR 306) WHEREIN IT WAS HELD THAT MERE FAILURE TO STRIKE - OFF INAPPROPRIATE PORTION IN A NOTICE WILL NOT RENDER IT INVALID? 3. LD.CIT(A) OUGHT TO HAVE FURTHER CONSIDERED THAT DECISION OF HON'BLE AP HIGH COURT IN THE CASE OF BAISETTY REVATHI RELIED UPON BY CIT(A) OVERLOOKING THE DECISION IN THE CASES CITED SUPRA IS A DECISION RENDERED PER INCURIA M . 4. LD.CIT(A) OUGHT TO HAVE APPRECIATED THAT MERE DISMISSAL OF SLP FILED BY THE REVENUE IN THE CASE OF CIT VS SSA'S EMERALD MEADOWS (73 TAX M ANN 248) WITHOUT LAYING DOWN ANY LA ON THE SUBJECT CANNOT BE SAID TO BE DECLARATION OF LAW BY THE SUPREME COURT (263 ITR 658). 5. THE APPELLANT CRAVES LEAVE TO ADD OR AMEND OR ALTER OR DELETE ANY GROUND AT THE TIME OF HEARING OF THE APPEAL. 6. FOR THESE AND OTHER GROUNDS THAT MAY BE URGED AT THE TIME OF APPEAL HEARING, THE APPELLANT PRAYS THAT THE IMPUGNED PENALTY LEVIED BY THE AO U/S 271(1 )(C) OF THE IT ACT HE RESTORED. 3. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSEE , A CLOSELY HELD COMPANY WITH TWO DIRECTORS NAMELY ; CHILUKURI SRINIVAS AND SMT. CHILUKURI NEELIMA AND HAVING THE BUSINESS ACTIVITY OF REAL ESTATE DEVELOPMENT ALSO PROJECTS , FILED A RETURN OF INCOME FOR THE ASSESSMENT YEAR 2011 - 12 ON 22/12/2011 ADMITTING INCOME OF 3 ITA NO. 243/VIZ/2018 & C.O.NO. 47/VIZ/2018 ( M/S. CHILUKURI HOUSING PROJECTS PVT. LTD. ) RS.3,13,35,730/ - AND AC C ORD I NGLY TAX OF RS. 1,19,99,660 / - HAS BEEN PAID . IN THIS CASE , A SURVEY UNDER SECTION 133A WAS CONDUCTED ON 24/10/2011 . THE MANAGING DIRECTOR - SHRI CHILUKURI SRINIVAS ADMITT ED INCOME OF RS. 3.13 CRORES FOR THE ASSESSMENT YEAR 2011 - 12 . DURING THE COURSE OF SURVEY, THE ASSESSEES MANAGING DIRECTOR HAS BEEN ASKED TO FURNISH THE DETAILS OF VENTURES UNDERTAKEN AND SALE OF PLOTS BY THE ASSESSEE - COMPANY , IN WHICH IT WAS KNOWN THAT THE ACCOUNTS OF THE ASSESSEE WERE NOT COMPLETELY FINALIZED AT THE TIME OF SURVEY . THE REASON FOR DELAY WAS THE ASSESSEE S ANOTHER PARTNERSHIP FIRM M/S. JAYA CONSTRUCTIONS JOINTLY DEVELOPED AND LAND OWNED BY THEM. MOST OF THE EXPENSES WERE INCURRED COMMONLY IT POSED LOT OF DIFFICULTIES IN EXACT BIFURCATION OF THE DEVELOPMENT EXPENSES . AS PER THE INCOMPLETE ACCOUNTS, THE TOTAL AMOUNT OF PROFIT OF THE ASSESSEE - COMPANY FOR THE IMPUGNED ASSESSMENT YEAR WAS RS. 35,44,809/ - . LATER , THE ASSESSEE FINALISED ITS BOOKS OF ACCOUNT ON THE ACTUAL FIGURES FILED A RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION ADMITTED ITS TOTAL INCOME OF RS. 3,13, 35,730/ - . THERE IS A DIFFERENCE OF RS. 2,77,90,822/ - BEING THE DIFFERENCE BETWEEN RS.3,13,35,730/ - AND RS. 35,44,809/ - . THE RETURN FILED BY THE ASSESSEE WAS SELECTED FOR SCRUTINY AND ASSESSMENT WAS COMPLETED 4 ITA NO. 243/VIZ/2018 & C.O.NO. 47/VIZ/2018 ( M/S. CHILUKURI HOUSING PROJECTS PVT. LTD. ) UNDER SECTION 143(3) BY DETERMINING TOTAL INCOME OF RS. 3.28 CRORES . SUBSEQUENTLY , THE ASSESSING OFFICER ISSUED A NOTICE UNDER SECTION 271(1)(C) OF THE ACT AND CALLED THE ASSESSEE WHY PENALTY SHOULD NOT BE LEVIED. THE ASSESSEE HAS SUBMITTED A DETAILED EXPLANATION BEFORE THE ASSESSING OFFICER, HOWEVER , THE ASSESSING OFFICER HAS LEVIED PENALTY UNDER SECTION 271(1)(C) OF THE ACT. 4 . ON APPEAL BEFORE THE LD. CIT(A) , ASSESSEE HAS RELIED ON THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF CIT VS. SSAS EMERALD MEADOWS [(2016) 73 TAXMAN.COM 248 (SC)] AND ALSO THE DECISION OF KARNATAKA HIGH COURT IN THE CASE OF CIT VS. MANJUNATHA COTTON AND GINNING FACTORY (359 ITR 565) AND SUBMITTED THAT THE ASSESSING OFFICER HAS TO SPECIFIC , ON WHICH LIMB PENALTY IS IMPOSED I.E. WHETHER FOR THE CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOME. HE FURTHER SUBMITTED THAT THE ASSESSING OFFICER IS NOT CLEAR IN ISSUING NOTICE UNDER SECTION 271 R.W.S. 274, DATED 2 8/02/2014, THEREFORE, PRAYED THAT SAME HAS TO BE QUASHED. THE LD. CIT(A) BY CONSIDERING THE DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SMT. BAISETTY REVATHI (SUPRA) HELD THAT NOTICE ISSUED BY THE ASSESSING OFFICER UNDER SECTION 271 IS INVAL I D AND CANCELLED THE PENALTY LEVIED BY THE ASSESSING OFFICER. FOR THE SAKE OF 5 ITA NO. 243/VIZ/2018 & C.O.NO. 47/VIZ/2018 ( M/S. CHILUKURI HOUSING PROJECTS PVT. LTD. ) CONVENIENCE, THE RELEVANT PORTION OF THE ORDER IS EXTRACTED AS UNDER: - 4.1 . I HAVE CONSIDERED THE ABOVE PETITION. AS THIS GBROUND OF APPEAL RAISES LEGAL ISSUES, I CONSI DER IT APPROPRIATE TO ADMIT THIS ADDITIONAL GROUND. ACCORDINGLY, THE SAME IS ADMITTED FOR ADJUDICATION. 5. DURING THE APPEAL HEARING, THE AR IN ADDITION TO THE SUBMISSIONS MADE IN THE ABOVE PETITION, CONTENDED THAT IT IS OBLIGATORY ON THE PART OF THE AO T O ISSUE THE NOTICE FOR WHICH LIMB OF THE OFFENCE, THE ASSESSEE IS REQUIRED TO FURNISH THE EXPLANATION. IT WAS FURTHER CONTENDED THAT THE AO MUST BE SATISFIED THAT A PERSON HAS EITHER CONCEALED THE PARTICULARS OF INCOME OR FURNISHED THE INACCURATE PARTICULA RS AS IT SHOULD BE MADE KNOWN TO THE ASSESSEE IN THE NOTICE CALLING FOR EXPLANATION. THE AR ALSO FILED COPY OF NOTICE ISSUED BY THE AO U/S.274 R.W.S.271(1)(C) OF THE I.T.ACT AND CONTENDED THAT FROM THE NOTICE, IT IS SEEN THAT THE A O IS NOT SURE FOR WHICH L IMB OF THE NOTICE, THE AD SOUGHT EXPLANATION FROM THE ASSESSEE. THE AR BY RELYING ON THE ABOVE DECISIONS AND ALSO THE DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SMT.BAISETTY REVATHY, CONTENDED THAT THE PENALTY IMPOSED BY THE AD WITHOU T STRIKING THE IRRELEVANT COLUMN IS UNSUSTAINABLE AND REQUESTED TO CANCEL THE PENALTY. 6. I HAVE CONSIDERED THE SUBMISSIONS MADE AND ALSO GONE THROUGH THE INFORMATION FURNISHED DURING APPEAL PROCEEDINGS. THE PENALTY NOTICE ISSUED BY THE AD READS AS UNDER : WHEREAS IN THE COURSE OF PROCEEDING BEFORE ME FOR THE ASST. YEAR 2011 - 12 IT APPEARS TO ME THAT YOU HAVE CONCEALED THE PARTICULARS OF YOUR INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME. 6.1 FROM THE NOTICE ISSUED, IT IS SEEN THAT AO ISSUED NOT ICE FOR CONCEALMENT OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS, WHICH PROVES THAT THE ASSESSING OFFICER WAS NOT SURE OF WHICH OF THE OFFENCE HE SOUGHT THE EXPLANATION. IN THIS REGARD, IT IS RELEVANT TO REFER TO THE DECISION RENDERED BY THE HON'B LE JU RISDICTIONAL HIGH COURT IN THE CASE OF SMT.BAISETTY REVATHY(ITTA.NO.684/2016) WHEREIN THE HON'BLE COURT HAS HELD AS UNDER : - O N PRINCIPLE, WHICH PENALTY PROCEEDINGS ARE SOUGHT TO BE INITIATED BY THE REVENUE UNDER SECTION 271(1)(C) OF THE ACT OF 1961, THE SPECIFIC GROUND WHICH FORMS THE FOUNDATION 6 ITA NO. 243/VIZ/2018 & C.O.NO. 47/VIZ/2018 ( M/S. CHILUKURI HOUSING PROJECTS PVT. LTD. ) THEREFORE HAS TO BE SPELT OUT IN CLEAR TERMS. OTHERWISE, AN ASSESSEE WOULD NOT HAVE PROPER OPPORTUNITY TO PUT FORTH HIS DEFENSE. WHEN THE PROCEEDINGS ARE PENAL IN NATURE RESULTING IN IMPOSITION OF PENALTY RANGING FROM 100% TO 300% OF THE TAX LIABILITY, THE CHARGE MUST BE UNEQUIVOCAL AND UNAMBIGUOUS. WHEN THE CHARGE IS EITHER CONCEALMENT O F PARTICULARS OF INCOME OR FURNISHING OF INACCURATE PARTICULARS THEREOF, THE REVENUE MUST SPECIFY AS TO WHICH ONE OF THE TWO IS SOUGHT TO BE PRESSED INTO SERVICE AND CANNOT BE PERMITTED TO CLUB BOTH BY INTERJECTING AN 'OR' BETWEEN THE TWO, AS IN THE PRESEN T CASE. THIS AMBIGUITY IN THE SHOW - CAUSE NOTICE IS FURTHER COMPOUNDED PRESENTLY BY THE CONFUSED FINDING OF THE ASSESSING OFFICER THAT HE WAS SATISFIED THAT THE ASSESSEE WAS GUILTY OF BOTH. WE ARE THEREFORE OF THE OPINION THAT THE ORDER UNDER APPEAL DOES N OT BROOK INTERFERENCE ON ANY AROUND. WE FIND NO Q UESTION OF LAW , MUCH LESS A SUBSTANTIAL ONE, ARISING FOR CONSIDERATION WARRANTING ADMISSION OF THIS APPEAL. 6.2 ON THE SIMILAR FACTS, THE HON'BLE ITAT IN THE CASE OF KONCHADA SREERAM (ITA NO. 388/VIZAG/2015) FOLLOWING THE DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT CITED (SUPRA) AND ITS OWN DECISION IN THE CASES OF NARAYANA REDDY ENTERPRISES (229/VIZ/2015) AND SMT. MAKINA ANNAPURNA (ITA NOS. 604 & 605/VIZAG/2014) HELD THAT NON - STRIKING OF THE IRRELEVANT COLUMN RENDERS THE NOTICE ISSUED U/S. 271 AS INVALID. 5 . ON BEING AGGRIEVED, THE DEPARTMENT IS IN APPEAL BEFORE THE TRIBUNAL. 6 . LD. DEPARTMENTAL REPRESENTATIVE HAS SUBMITTED THAT AT THE TIME OF ISSUANCE OF NOTICE, THE ASSESSING OFFICER IS NOT SURE ABOUT THE PENALTY EITHER FOR CONCEALMENT OF INCOME OR FURNISHING INACCURATE PARTICULARS. THEREFORE, IT IS A PREMATURE NOTICE AND 7 ITA NO. 243/VIZ/2018 & C.O.NO. 47/VIZ/2018 ( M/S. CHILUKURI HOUSING PROJECTS PVT. LTD. ) SUBMITTED THAT THE NOTICE ISSUED BY THE AS SESSING OFFICER IS A VALID NOTICE. 7 . ON THE OTHER HAND, L EARNED COUNSEL FOR THE ASSESSEE HAS RELIED ON THE ORDER PASSED BY THE LD. CIT(A) AND ALSO THE DECISION OF THE COORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF KONCHADA SREERAM VS. ITO IN ITA NO. 388/VIZ/2015, BY ORDER DATED 06/10/2017 . 8 . WE HAVE HEARD BOTH THE SIDES, PERUSED THE MATERIAL AVAILABLE ON RECORD AND ORDERS OF THE AUTHORITIES BELOW. 9 . THE ONLY ISSUE FOR ADJUDICATION BEFORE US IS W HE THER THE NOTICE ISSUED BY THE ASSESSING O FFICER DATED 28/02/2014 IS VALID OR NOT . FOR THE SAKE OF CONVENIENCE , THE NOTICE IS EXTRACTED AS UNDER: - WHEREAS IN THE COURSE OF PROCEEDINGS BEFORE ME FOR THE ASSESSMENT YEAR 20 11 - 1 2 , IT APPEARS TO ME THAT YOU : X X X X X X X X X * HAVE CONCEALED THE PARTICULARS OF YOUR INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME. 1 0 . FROM THE ABOVE, IT IS NOT CLEAR WHETHER ASSESSING OFFICER HAS INITIATED PENALTY PROCEEDINGS FOR CONCEALMENT OF PARTICULARS OF INCOME OR FOR FURNISHED INACCURATE PARTICULARS. THEREFORE, THE NOTICE ISSUED BY THE ASSESSING OFFICER IS A VAGUE NOTICE AND IS LIABLE TO BE QUASHED IN THE LIGHT OF THE DECISION OF THE HON'BLE 8 ITA NO. 243/VIZ/2018 & C.O.NO. 47/VIZ/2018 ( M/S. CHILUKURI HOUSING PROJECTS PVT. LTD. ) JURISDICTIONAL HIGH COURT IN THE CASE OF SMT. BAISETTY REVATHI (SUPRA) AND ALSO THE DEC ISION OF THE HON'BLE SUPREME COURT IN THE CASE OF SSAS EMERALD MEADOWS (SUPRA) . THE COORDINATE BENCH OF THE VISAKHAPATNAM TRIBUNAL IN THE CASE OF KONCHADA SREERAM VS. ITO IN ITA NO. 388/VIZ/2015 , BY ORDER DATED 06/10/2017 HAS CONSIDER ED THE VALIDITY OF NOTICE BY FOLLO W ING THE ABOVE REFERRED TO JUDGMENT S AND HELD THAT NOTICE ISSUED BY THE ASSESSING OFFICER IS NOT A VALID NOTICE AND ACCORDINGLY QUASHED. FOR THE SAKE OF CONVENIENCE, THE RELEVANT PORTION OF THE ORDER IS EXTRACTED AS UNDER: - 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL PLACED ON RECORD. IN THIS CASE, THE ASSESSEE HAS NOT FILED THE RETURN OF INCOME. THE DEPARTMENT HAS CONDUCTED THE SURVEY U/S 133A AND COMPLETED THE ASSESSMENT U/S 143(3) ON TOTAL INCOME OF RS.15,43,041/ - AND INITIATED PENALTY PROCEEDINGS U/S 271(1)(C). THE FACT IS THAT LONG TERM CAPITAL GAINS FOR SALE OF THE PROPERTY HAVE COME TO THE NOTICE OF THE ASSESSING OFFICER BECAUSE OF THE EFFORTS MADE BY THE DEPARTMENT. THEREFORE, THE AO HAS INITIAT ED THE PENALTY PROCEEDINGS U/S 271(1)(C) AND ISSUED SHOW CAUSE NOTICE IN THE PRINTED PROFORMA OF PENALTY. THE AO HAS ISSUED THE PENALTY NOTICE WHICH READS AS UNDER : WHEREAS IN THE COURSE OF THE PROCEEDING BEFORE ME FOR THE ASST. YEAR 2007 - 08 IT APPEARS TO ME THAT YOU HAVE CONCEALED THE PARTICULARS OF YOUR SOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME. 6.1. FROM THE NOTICE ISSUED BY THE AO, IT IS OBSERVED THAT THE ASSESSING OFFICER HAD ISSUED THE NOTICE FOR CONCEALMENT OF INCOME OR FOR FURNIS HING OF INACCURATE PARTICULARS. AS PER THE NOTICE, THE ASSESSING OFFICER WAS NOT SURE OF WHICH LIMB OF THE OFFENCE HE SOUGHT THE EXPLANATION FROM THE ASSESSEE, WHETHER IT WAS FOR THE CONCEALMENT OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS. AS P ER THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT CITED, FOR STARTING THE PENALTY PROCEEDINGS, THE CONDITION PRECEDENT IS THAT THE ASSESSING OFFICER MUST BE SATISFIED THAT A PERSON HAS EITHER CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHED INAC CURATE PARTICULARS OF SUCH INCOME. THE PERSON WHO IS 9 ITA NO. 243/VIZ/2018 & C.O.NO. 47/VIZ/2018 ( M/S. CHILUKURI HOUSING PROJECTS PVT. LTD. ) ACCUSED OF THE CONDITIONS MENTIONED IN SECTION 271 SHOULD BE MADE AWARE OF THE GROUNDS ON WHICH IMPOSITION OF PENALTY IS PROPOSED AS HE HAS A RIGHT TO CONTEST SUCH PROCEEDINGS AND SHOULD HAVE THE FULL O PPORTUNITY TO MEET THE CASE OF THE REVENUE SO AS TO SHOW THAT THE CONDITIONS STIPULATED IN SECTION 271(1)(C) DO NOT EXIST AND THAT HE IS NOT LIABLE TO PAY THE PENALTY. THE HONBLE HIGH COURT OF KARNATAKA IN THE CASE LAW CITED HELD THAT THE PRACTICE OF THE REVENUE IN SENDING THE PRINTED FORM WHERE ALL THE GROUNDS MENTIONED IN 271(1)(C) ARE MENTIONED WOULD NOT SATISFY THE REQUIREMENT OF LAW WHEN THE CONSEQUENCE OF THE ASSESSEE NOT REBUTTING THE INITIAL PRESUMPTION IS SERIOUS IN NATURE AND HAS TO PAY THE PENA LTY RANGING FROM 100% TO 300% OF THE TAX LIABILITY. AS THE PROVISIONS OF SECTION 271(1)(C) HAVE TO BE STRICTLY CONSTRUED, THE HONBLE HIGH COURT OF KARNATAKA MANDATED THAT THE NOTICE ISSUED SHOULD BE SET OUT THE GROUNDS WHICH THE ASSESSEE HAS TO MEET SPE CIFICALLY, OTHERWISE THE PRINCIPLES OF NATURAL JUSTICE WOULD BE OFFENDED AS THE SHOW CAUSE NOTICE WOULD BE VAGUE. ON THE SIMILAR FACTS, HONBLE SUPREME COURT DISMISSED THE SLP IN THE CASE OF SSAS EMERALD MEADOWS (2016) 73 TAXMAN.COM 248(SC). LD. DRS ARG UMENT THAT THE CASE IS DISTINGUISHABLE ON FACTS IS NOT ACCEPTABLE SINCE THE LD. DR RELIED ON THE PASSING OBSERVATION OF THE HONBLE HIGH COURT OF AP. IN THE ASSESSEES CASE, THE ISSUE IS THE DEFECTIVE NOTICE U/S 271(1)(C) BUT NOT THE PENALTY ORDER. UNLESS THE NOTICE ISSUED U/S 271(1)(C) IS VALID THE PENALTY ORDER CANNOT BE HELD TO BE VALID. THE ASSESSING OFFICER DID NOT STRIKE OFF THE IRRELEVANT COLUMN IN THE NOTICE AND MADE KNOWN THE ASSESSEE WHETHER THE PENALTY WAS INITIATED FOR THE CONCEALMENT OF INCOM E OR FOR FURNISHING THE INACCURATE PARTICULARS. IN THE ASSESSMENT ORDER ALSO THE AO SIMPLY RECORDED THAT THE PENALTY PROCEEDINGS U/S 271(1)(C) ARE INITIATED SEPARATELY. NEITHER IN THE ASSESSMENT ORDER NOR IN THE PENALTY NOTICE, THE ASSESSING OFFICER HAS PUT THE ASSESSEE ON NOTICE FOR WHICH OFFENCE, THE PENALTY U/S 271 WAS INITIATED. THEREFORE, THE CASE IS SQUARELY COVERED BY THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT OF CITED (SUPRA) WHEREIN THE HONBLE HIGH COURT HELD AS UNDER: ON PRINCIPL E, WHEN PENALTY PROCEEDINGS ARE SOUGHT TO BE INITIATED BY THE REVENUE UNDER SECTION 271(1)(C) OF THE ACT OF 1961, THE SPECIFIC GROUND WHICH FORMS THE FOUNDATION THEREFORE HAS TO BE SPELT OUT IN CLEAR TERMS OTHERWISE , ON ASSESEE WOULD NOT HAVE PROPER OPPORTUNITY TO PUT FORTH HIS DEFENCE. WHEN THE PROCEEDINGS ARE PENAL IN NATURE RESULTING IN IMPOSITION OF PENALTY RANGING FROM 100% TO 300% OF THE TAX LIABILITY, THE CHARGE MUST BE UNEQUIVOCAL AND UNAMBIGUOUS. WHEN THE CHARGE IS EITHER CONCEALMENT OF PARTI CULARS OF INCOME OR FURNISHING OF INACCURATE PARTICULARS THEREOF , THE REVENUE MUST SPECI F Y AS TO WHICH ONE OF THE TWO IS SOUGHT TO BE PRESSED INTO SERVICE AND CANNOT BE PERMITTED TO CLUB BOTH BY INTERJECTING AN 'OR' BETWEEN THE TWO, AS IN THE PRESENT CASE. THIS AMBIGUITY IN THE SHOW - CAUSE NOTICE IS FURTHER COMPOUNDED PRESENTLY BY THE CONFUSED FINDING OF THE ASSESSING OFFICER THAT HE WAS SATISFIED THAT THE ASSESSEE WAS GUILTY OF BOTH. 10 ITA NO. 243/VIZ/2018 & C.O.NO. 47/VIZ/2018 ( M/S. CHILUKURI HOUSING PROJECTS PVT. LTD. ) WE ARE THEREFORE OF THE OPINION THAT THE ORDER UNDER APPEAL DOES NOT BROO K INTERFERENCE ON ANY GROUND. WE FIND NO QUESTION OF LAW, MUCH LESS A SUBSTANTIAL ONE, ARISING FOR CONSIDERATION WARRANTING ADMISSION OF THIS APPEAL. 6.2. ON THE SIMILAR FACTS, THE COORDINATE BENCH OF ITAT, VISAKHAPATNAM IN ITA NO.229/VIZ/2015 IN THE CAS E OF NARAYANA REDDY ENTERPRISES, FOLLOWING THE ORDER OF THE COORDINATE BENCH IN THE CASE OF SMT. MAKINA ANNAPURNA VS. ITO, VISAKHAPATNAM IN ITA NOS.604 & 605/VIZAG/2014 DATED 2.2.2017 HELD THAT NON - STRIKING OF THE IRRELEVANT COLUMN RENDERS THE NOTICE ISSUE D U/S 271 AS INVALID. RESPECTFULLY, FOLLOWING THE DECISION OF THE HONBLE AP HIGH COURT CITED SUPRA AND THE DECISION OF THIS TRIBUNAL CITED (SUPRA), WE HOLD THAT THE NOTICE ISSUED U/S 271 IS INVALID AND CONSEQUENT PENALTY IMPOSED BY THE AO IS CANCELLED. 1 1 . WE THEREFORE , RESPECTFULLY FOLLOWING THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF SSAS EMERALD MEADOWS (SUPRA) AND ALSO THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SMT. BAISETTY REVATHI (SUPRA) AND ALSO THE DECISION OF THE COORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF KONCHADA SREERAM (SUPRA) , WE HOLD THAT THE NOTICE ISSUED UNDER SECTION 27 1 READ WITH SECTION 27 4 I S INVALID AND, THE RE FORE PENALTY IMPOSED BY THE ASSESSING OFFICER IS CANCELLED. 1 2 . THE CROSS OBJECTION FILED BY THE ASSESSEE IS SUPPORTIVE TO THE ORDER OF THE LD. CIT(A). IN VIEW OF OUR DECISION ABOVE, THE CROSS OBJECTION FILED BY THE ASSESSEE HAS BECOME INFRUCTUOUS IS DISMISSED ACCORDINGLY . 11 ITA NO. 243/VIZ/2018 & C.O.NO. 47/VIZ/2018 ( M/S. CHILUKURI HOUSING PROJECTS PVT. LTD. ) 1 3 . IN THE RESULT, APPEAL FILED BY THE REVENUE AS WELL AS CROSS OBJECTION FILED BY THE ASSESSEE IS DISMISSED . ORDER PRONOUNCED IN OPEN COURT ON TH IS 2 5 T H DAY OF JAN . , 201 9 . S D / - S D / - ( D.S. SUNDER SINGH ) ( V. DURGA RAO ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 2 5 T H JAN . , 201 9 . VR/ - COPY TO: 1. THE ASSESSEE M/S. CHILUKURI HOUSING PROJECTS PVT. LTD., 9 - 21 - 17/2, GROUND FLOOR, STREET NO. 21, CBM COMPOUND, VISAKHAPATNAM. 2. THE REVENUE ACIT, CIRCLE - 1 ( 1 ) , VISAKHAPATNAM . 3. THE PR. CIT - 1 , VISAKHAPATNAM . 4. THE CIT(A) - 1 , VISAKHAPATNAM . 5. THE D.R . , VISAKHAPATNAM . 6. GUARD FILE. BY ORDER (VUKKEM RAMBABU) SR. PRIVATE SECRETARY, ITAT, VISAKHAPATNAM.