Sangeeta Management Consultancy (P) Ltd., Indore V. ITO-5(1) , Indore

ITA 273/Ind/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 3697 (ITAT-INDORE)
• Duration Of Justice: 10 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-02-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Indore
• Assessment Year: 2015-2016
• Appeal Filed On: 22-03-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Principle of natural justice; Question of law; Reasonable cause; Non compliance; Set aside
• Section: 271(1)(c); 143(3); 274; 139(1); 73; 13; 22

Judgement Text

[ITA NO.273/IND/2019] [SANGEETA MANAGEMENT CONSULTANCY P. LTD. ] 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO.273/IND/2019 ASSESSMENT YEAR: 2015-16 SANGEETA MANAGEMENT CONSULTANCY PRIVATE LTD. INDORE / VS. ITO - 5(1) INDORE ( APPELLANT ) ( REVENUE ) P.A. NO. AAOCS4857N APPELLANT BY SHRI MAHESH AGRAWAL & AMIT CHOUDHARI ARS REVENUE BY SHRI K.G. GOYAL, DR DATE OF HEARING: 10.02.2020 DATE OF PRONOUNCEMENT: 19.02.2020 / O R D E R PER KUL BHARAT, J.M: THIS APPEAL BY THE ASSESSEE IS DIRECTED ORDER OF THE CIT(A)-II, INDORE DATED 24.01.2019 FOR THE ASSESSMENT YEAR 2015-16. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: [ITA NO.273/IND/2019] [SANGEETA MANAGEMENT CONSULTANCY P. LTD. ] 2 1. THE HON'BLE CIT(A)-II HAS ERRED IN UPHOLDING TH E PENALTY IMPOSED U/S 271(1)(C) OF THE INCOME TAX ACT 1961, AT RS.8,00,000/- 2. THE HON'BLE CIT(A)-II ERRED IN LAW BY PASSING TH E ORDER WITHOUT GIVING PROPER OPPORTUNITY TO THE ASSE SSEE. SUCH AN ORDER SO PASSED IS NOT SUSTAINABLE IN LAW SHOULD BE QUASHED. THE SAME MAY KINDLY BE QUASHED. 3. THE PENALTY LEVIED UNDER SECTION 271(1)(C) WITHO UT SPECIFYING CHARGE IN SHOW CAUSE NOTICE IS NOT SUSTAINABLE IN LAW HENCE HON'BLE CIT(A)-II HAS ERRE D IN LAW BY UPHOLDING SUCH AN ORDER. HENCE, THE ORDER SO PASSED SHOULD BE QUASHED. THE SAME MAY KINDLY BE QUASHED. 4. THE APPELLANT CRAVES LEAVE TO ADD ANY NEW GROUND OF APPEAL OR ALTER, AMEND OR DELETE ANY OF THE ABOVE GROUNDS OF APPEAL. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED R ETURN OF INCOME DECLARING TOTAL INCOME AT RS. NIL. HOWEVER, THE AO COMPLETED THE ASSESSMENT BY MAKING ASSESSMENT OF RS.24,33,996/- ON ACCOUNT OF DISALLOWANCES OF LOSSES CLAIMED FROM SALE OF SOME SCRIPTS. THE AO HELD THAT SH ARES OF THE COMPANY WERE ONLY PENNY STOCK. THE RATES OF SH ARES WERE NOT BASED ON ACTUAL BUSINESS RESULTS OF SUCH COMP ANY [ITA NO.273/IND/2019] [SANGEETA MANAGEMENT CONSULTANCY P. LTD. ] 3 BUT THE SAME WERE FLUCTUATED OR RIGGED BY INSIDER TRAD ING, FROM A NEGLIGIBLE VALUE TO VERY HIGH PRICE, WITHOUT R EASON OR BASIS ONLY TO ACCOMMODATE ENTRY PROVIDERS OR ACCOMMODATE LOSSES. THEREFORE, THE LOSS OF RS.24,33,9 96/- WAS NOT ACCEPTABLE AND ACCORDINGLY WAS DISALLOWED. SIMULTANEOUSLY PENALTY PROCEEDINGS U/S 271(1)(C) WERE INITIATED SEPARATELY ON THE GROUND THAT THE ASSESSEE HAS CONCEALED INCOME AS WELL AS FURNISHED INACCURATE PARTICULARS OF INCOME FOR WHICH A NOTICE WAS ISSUED TO THE ASSESSEE REQUIRING TO FURNISH ITS WRITTEN SUBMISSION IN THIS REGARD. THE ASSESSEE FILED ITS WRITTEN SUBMISSION WHI CH WAS GONE THROUGH BY THE AO BUT THE SAME WAS NOT ACCEPTABLE ON THE GROUND THAT THE ASSESSEE DID NOT SUBMIT ANY SPE CIFIC MATERIALS WITH REGARD TO THE IMPORTANT FACTS AS DISCUSSED IN THE ASSESSMENT ORDER AS WELL AS ALLEGED MODUS OPERAND I ADOPTED IN THIS REGARD. [ITA NO.273/IND/2019] [SANGEETA MANAGEMENT CONSULTANCY P. LTD. ] 4 3. AGGRIEVED ASSESSEE PREFERRED AN APPEAL BEFORE LD. CI T(A) AND LD. CIT(A), HOWEVER, DISMISSED THE ASSESSEES APPE AL. 4. AGGRIEVED ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL RAISING GROUND NO.3 CHALLENGING THE LEGALITY OF SHOW C AUSE NOTICE. LD. COUNSEL FOR THE ASSESSEE PLACED RELIANCE O N THE JUDGMENT OF HON'BLE SUPREME COURT IN THE CASE OF NATIONAL THERMAL POWER CO. LTD. VS. CIT (1992) 229 ITR 383 ( SC). DURING THE COURSE OF HEARING LD. COUNSEL FOR THE ASSE SSEE REFERRING TO THE JUDGMENT OF HON'BLE HIGH COURT OF MADHYA PRADESH IN THE CASE OF PR. CIT V/S KULWANT SINGH BHATIA ITA NO. 9 TO 14 OF 2018 DATED 09.05.2018 SUBMITTED THAT THE PENALTY NOTICED ISSUED U/S 274 OF THE ACT SUFFER S FROM SEVERE DEFECT AS THE LD. AO FAILED TO RAISE ANY SPECIFI C CHARGE AGAINST THE ASSESSEE AS TO WHETHER THE PENALTY HAS BEEN LEVIED FOR CONCEALMENT OF INCOME OR FOR FURNISH ING INACCURATE PARTICULARS OF INCOME. [ITA NO.273/IND/2019] [SANGEETA MANAGEMENT CONSULTANCY P. LTD. ] 5 5. RELIANCE WAS ALSO PLACED ON THE FOLLOWING JUDGMENTS IN SUPPORT OF THE GROUNDS AGAINST PENALTY IMPOSED AS WELL AS THE LEGAL GROUND: 1. PR. CIT V/S KULWANT SINGH BHATIA ITA NO. 9 TO 14 OF 2018 DATED 09.05.2018 HONBLE HIGH COURT OF MADHYA PRADESH 2. KETI SANGAM INFRASTRUCTURE (I) LTD. AND OTHERS I TA NO 1343 & 601/IND/2016 DATED 27.06.2018, I.T.A.T., INDORE BENCH 3. BANSHIDHAR SOMANI VS DCIT (CENTRAL)-1 INDORE ITA NO 619 TO 624/IND/2017 DATED 17.12.2018 I.T.A.T., INDORE BENCH 4. KIRIT KUMAR C. THACKER V/S JCIT (2016) 47 CCH 0038 RAJKOTTRIB DATED 06.05.2016 ITAT RAJKOT BENCH AHMEDABAD 5. SEJAL EXPORTS (INDIA) VS. ACIT (I.T.A. NO.5724,5 727 AND 5729/MUM/2012), I.T.A.T. MUMBAI BENCH 6. PER CONTRA LD. DR VEHEMENTLY ARGUED SUPPORTING THE ORDERS OF THE LOWER AUTHORITIES AND RELIANCE WAS ALSO PL ACED IN THE FOLLOWING JUDGMENTS FAVOURING THE REVENUE ON THE ISSUE OF LEVYING PENALTY ON THE EARNED DISCLOSED INCO ME SURRENDERED DURING THE COURSE OF SEARCH: [ITA NO.273/IND/2019] [SANGEETA MANAGEMENT CONSULTANCY P. LTD. ] 6 1. SANDEEP CHANDAK VS. PR. CIT, KANPUR, (2018) 93 TAXMANN.COM 406 (SC) 2. CIT VS. PRASANNA DUGAR (2015) 59 TAXMANN.COM 99 ( HIGH COURT OF CALCUTTA) 3. PR. CIT, KANPUR VS. SHRI SANDEEP CHANDAK ON 27.11.2017 (HIGH COURT OF ALLAHABAD 7. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RE CORD PLACED BEFORE US. WITH REGARD TO THE APPEAL RAISED AGAINST LEVY OF PENALTY U/S 271(1)(C) OF THE ACT GROUND NO.3 HAS BEEN RAISED AS A LEGAL GROUND. 8. WE WILL FIRST TAKE UP LEGAL GROUND WHICH CHALLENGES THE LEGALITY OF THE PENALTY PROCEEDINGS BEING VOID AB INITIO AND BAD IN LAW AS THE PENALTY NOTICE 274 OF THE ACT IS ALL EGED TO BE DEFECTIVE AND ISSUED WITHOUT SPECIFYING THE CHARGE ON WHICH THE PENALTY HAS BEEN LEVIED. 9. IN ORDER TO ADJUDICATE THE LEGAL GROUND WE WILL FIR ST LIKE THE REPRODUCE IMPUGNED NOTICE ISSUED FOR LEVY OF PE NALTY U/S 271(1)(C) OF THE ACT: [ITA NO.273/IND/2019] [SANGEETA MANAGEMENT CONSULTANCY P. LTD. ] 7 OFFICER OF THE ITO-5(1), INDORE NOTICE UNDER SECTION 274 READ WITH SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 PAN:AAOCS4857N DATE:28.12.2017 TO, SANGEETA MANAGEMENT, CONSULTANCY PVT. LTD. 201,OASIS TOWER, Y.N. ROAD, INDORE -452001 SIR, WHEREAS IN THE COURSE OF PROCEEDINGS BEFORE ME FOR THE ASSESSMENT YEAR 2012-13 IT APPEARS TO ME THAT YOU:- *HAVE WITHOUT REASONABLE CAUSE FAILED TO FURNISH TH E RETURN OF INCOME WHICH YOU WERE REQUIRED TO FURNISH BY A N OTICE GIVEN UNDER SECTION 22 ( 1 )/22(2)/34 OF THE INDIAN INCOME TAX ACT 1922 OR WHICH YOU WERE REQUIRED TO FURNISH UNDER SECTION 139(1) OR BY A NOTICE GIVEN UNDER SECTION 13 9(2) / 148 OF THE INCOME TAX ACT, 1961, NO. DATED OR HAVE WITHOUT REASONABLE CAUSE FAILED TO FURNISH IT WITHI N THE TIME ALLOWED AND IN THE MANNER REQUIRED BY THE SAID SECTION 139(1) OR BY SUCH NOTICE. *HAVE 'WITHOUT REASONABLE CAUSE FAILED TO COMPLY WI TH A NOTICE UNDER SECTION 22 (4 )/23 (2) OF THE INDIAN INCOME TAX AD, 1922 OR UNDER SECTION 142 (1 )/143 (2) OF THE INCOME TAX ACT, 1961 NO DATED ___________________ [ITA NO.273/IND/2019] [SANGEETA MANAGEMENT CONSULTANCY P. LTD. ] 8 *HAVE CONCEALED THE INCOME AS WELL AS FURNISHED INA CCURATE PARTICULARS OF SUCH INCOME AS PER ORDER U/S 143(3) DATED 28.12.2017. YOU ARE HEREBY REQUESTED TO APPEAR BEFORE ME AT 1.0 0 PM ON 11.01.2018 AND SHOW CAUSE WHY AN ORDER IMPOSING A PENALTY ON YOU SHOULD NOT BE MADE UNDER SECTION 271 (1)(C) OF THE INCOME-TAX ACT 1961. IF YOU DO NOT WI SH TO AVAIL YOURSELF OF THIS OPPORTUNITY OF BEING HEARD I N PERSON OR THROUGH AUTHORIZED REPRESENTATIVE YOU MAY SHOW CAUS E IN WRITING ON OR BEFORE THE SAID DATE WHICH WILL BE CO NSIDERED BEFORE ANY SUCH ORDER IS MADE UNDER SECTION 271 (1)(C). SD/- (DILEEP PATIL) INC OME TAX OFFICER -5(1) INDORE 10. FROM PERUSAL OF THE ABOVE NOTICE WE FIND THAT BOTH THE CHARGES ARE MENTIONED IN THE NOTICE NAMELY CONCEALMENT OF PARTICULARS OF INCOME AND FURNISHING INACCURATE PARTICULAR S OF INCOME. LD. AO HAS FAILED TO TICK ANY ONE OF THEM, THEREBY NOT SPECIFYING THE CHARGE UNDER WHICH THE PE NALTY HAS BEEN LEVIED. NOW IN A CASE WHETHER THE NOTICE U/S 274 OF THE ACT SUFFERS FROM A DEFECT BY VIRTUE OF WHICH NO [ITA NO.273/IND/2019] [SANGEETA MANAGEMENT CONSULTANCY P. LTD. ] 9 SPECIFIC CHARGE IS LEVELED AGAINST THE ASSESSEE, AS TO WHETHER THE PENALTY HAS BEEN LEVIED FOR CONCEALING OF PARTICULARS OF INCOME OR FOR FURNISHING INACCURATE PARTICULARS OF INCOME, WE FIND THAT HON'BLE JURISDICTI ONAL HIGH COURT IN THE CASE OF PR. CIT V/S KULWANT SINGH BHATIA (SUPRA) HAS DEALT WITH THE SAME AND HON'BLE COURT HAS DISMISSED THE REVENUES APPEAL SETTING ASIDE THE ORDER OF PENALTY IMPOSED BY THE AUTHORITIES BY REFERRING TO THE JUDGMENT OF HON'BLE APEX COURT IN THE CASE OF CIT VS. MANJUNATHA COTTON AND GINNING FACTORY (2013) 359 ITR 565(KARNATAKA) AS WELL AS JUDGMENT OF HON'BLE APEX COURT IN THE CASE OF CIT V/S SSAS EMERALD MEADOWS (2016) 73 TAXMANN.COM 248 (SC) AND OBSERVED AS FOLLOWS: ON DUE CONSIDERATION OF THE ARGUMENTS OF THE LEARNE D COUNSEL FOR THE APPELLANT, SO ALSO CONSIDERING THE FACT THAT THE GROUND MENTIONED IN SHOW CAUSE NOTICE WOUL D NOT SATISFY THE REQUIREMENT OF LAW, AS NOTICE WAS N OT SPECIFIC, WE ARE OF THE VIEW THAT LEARNED TRIBUNAL H AS RIGHTLY RELYING ON THE DECISION OF CIT V/S MANJUNAT H [ITA NO.273/IND/2019] [SANGEETA MANAGEMENT CONSULTANCY P. LTD. ] 10 COTTON GINNING FACTORY AND CIT V/S SSAS EMERALD MEADOWS RIGHTLY ALLOWED THE APPEAL OF THE ASSESSEE AND SET ASIDE THE ORDER OF PENALTY IMPOSED BY THE AUTHORITIES. NO SUBSTANTIAL QUESTION OF LAW IS ARIS ING IN THESE APPEALS. ITA. NO(S) 9/2018, 10/2018, 11/2018, 12/2018, 13/2018 AND 14/2018, FILED BY THE APPELLAN T HAVE NO MERIT AND ARE HEREBY DISMISSED. 11. WE FIND THAT SIMILAR LEGAL ISSUE CAME UP FOR ADJUDICATION BEFORE US IN THE CASE OF VARAD MEHTA ITA NO.693/IND/16 DATED 06.12.2018 (SUPRA) WHEREIN WE DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE, RELYING ON THE JUDGMENT OF HON'BLE JURISDICTIONAL HIGH COURT IN CASE OF KULWANT SINGH BHATIA (SUPRA ) OBSERVING AS FOLLOWS; 11. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE R ECORDS PLACED BEFORE US. THE ISSUES RAISED BY THE ASSESSEE REVOLVES AROUND THE LEVY OF PENALTY AT RS.16,00,000/- LEVIED BY THE LD. A.O AND CONFIRMED BY LD.CIT(A) ON THE ADDITION OF RS.51,00 ,000/- FROM UNDISCLOSED SOURCES FOR PURCHASE OF IMMOVABLE PROPER TIES. PERUSAL OF RECORDS SHOWS THAT THE ASSESSEE REMAINING NEGLIGE NT AND NON COMPLIANT TO VARIOUS OPPORTUNITIES PROVIDED BY THE L D. A.O AS WELL AS LD.CIT(A) DURING THE COURSE OF PENALTY PROCEEDINGS A S WELL AS APPELLATE PROCEEDINGS TOWARDS THE LEVY OF PENALTY. 12. NOW THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUN AL, FIRSTLY RAISING THE LEGAL ISSUE PLEADING THAT LD. A.O HAS WR ONGLY INITIATED THE PENALTY PROCEEDINGS BY NOT SPECIFYING THE CHARG E FOR LEVY OF PENALTY I.E. WHETHER THE PENALTY PROCEEDINGS HAS BE EN INITIATED FOR CONCEALING OF PARTICULARS OF INCOME OR FOR FURNISHI NG THE INACCURATE PARTICULARS OF INCOME. IT WAS ALSO PLEADED BY THE LD. COUNSEL FOR THE ASSESSEE THAT THOUGH THE LD. ASSESSING OFFICER HAS MADE PROPER [ITA NO.273/IND/2019] [SANGEETA MANAGEMENT CONSULTANCY P. LTD. ] 11 SATISFACTION ON RECORD IN THE ASSESSMENT ORDER FOR IN ITIATING PENALTY PROCEEDINGS BUT IN THE NOTICE ISSUE U/S 274 R.W.S. 271(1)(C) OF THE ACT, BUT LD. A.O REMAINED SILENT BY NOT SPECIFYING A S TO WHICH CHARGE THE PENALTY PROCEEDINGS HAVE BEEN INITIATED. TO EXAMINE THIS FACT WE HAVE GONE THROUGH THE IMPUGNED NOTICE ISSUED FOR INITIATING THE PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT W HICH IS PLACED AT PAGE-52 OF THE PAPER BOOK AND THE RELEVANT EXTRACT I S REPRODUCED BELOW: TO SHRI VARAD MEHTA 239, SUNNY PALACE M P NAGAR ZONE-1, BHOPAL SIR / MADAM, SUB:- PENALTY PROCEEDING U/S .. 271( 1 ) ( C) .. OF THE INCOME TAX ACT 1961 FOR THE AY 2008.09 IN CONNECTION WITH THE PENALTY PROCEEDINGS U/S, 271 (1) (C) FOR THE ASSESSMENT YEAR(S) 2008-09 YOU ARE REQUESTED TO ATTEND MY OFFICE ON 18.01. 2010 AT 11.00 AM TO SHOW CAUSE WHY PENALTY SHOULD NOT BE IMPOSED. HOWEVER. IF YOU DO NOT WISH T O BE HEARD IN PERSON IN THIS REGARD, YOU MAY SUBMIT YOUR WRITTEN S UBMISSIONS SO AS TO REACH ME BY THE ABOVE DATE WHICH WILL BE CONS IDERED BEFORE DISPOSAL OF THE MATTER. SD/- ( SHRLKANT NAMDEO ) DEPUTY GOMMISSFSONEROF1NCO ME TAX-1(1}, BHOPAL BHOPAL 13. FROM PERUSAL OF THE ABOVE SHOW CAUSE NOTICE WE FIND THAT THE LD.A.O HAS MERELY MENTIONED THE SECTION BUT THE SPECI FIC CHARGE I.E. WHETHER THE PENALTY HAVE BEEN INITIATED FOR CONCEAL MENT OF PARTICULARS OF INCOME OR FOR FURNISHING INACCURATE PARTICULARS OF INCOME HAS NOT BEEN MENTIONED. NOW WHETHER SUCH TY PE OF NOTICE WHICH DOES NOT SPEAK ABOUT THE SPECIFIC CHARGE LEVE LED AGAINST THE ASSESSEE IS VALID AND TENABLE IN THE EYES OF LAW NEE DS TO BE EXAMINED. 14. WE FIND THAT SIMILAR ISSUE CAME UP BEFORE THE JU RISDICTIONAL HIGH COURT IN THE CASE OF SHRI KULWANT SINGH BHATIA (SUPRA) WHEREIN THE HON'BLE COURT DISCUSSED THE JUDGMENT OF HON'BLE HIGH COURT IN THE CASE OF CIT V/S MANJUNATHA COTTON GINNING FACTO RY (SUPRA) AND CIT V/S SSAS EMERALAD MEADOWS (SUPRA) HELD THAT ON DUE [ITA NO.273/IND/2019] [SANGEETA MANAGEMENT CONSULTANCY P. LTD. ] 12 CONSIDERATION OF THE ARGUMENTS OF THE LD. COUNSEL FOR THE APPELLANT, SO ALSO CONSIDERING THE FACT THAT THE GROUND MENTIONE D IN SHOW CAUSE NOTICE WOULD NOT SPECIFY THE REQUIREMENT OF L AW, AS NOTICE WAS NOT SPECIFIC, WE ARE OF THE VIEW THAT LD. TRIBUNAL H AS RIGHTLY ALLOWED THE APPEAL OF THE ASSESSEE AND SET ASIDE THE ORDER OF PENALTY ENFORCED BY THE AUTHORITY. 15. SIMILARLY IN THE CASE OF CIT V/S MANJUNATHA GIN NING FACTORY, HON'BLE HIGH COURT OF KARNATAKA HELD THAT THE NOTIC E ISSUED U/S 274 R.W.S. 271(1)(C) OF THE ACT SHOULD SPECIFICALLY MENTION THE GROUND IN SECTION 271(1)(C) WHETHER CONCEALMENT OF INCOME OR FOR FURNISHING IN ACCURATE PARTICULARS OF INCOME. SENDING PRINTED FORM WHERE ALL GROUND OF SECTION 271(1)(C ) WOULD NOT MENTIONED THE SPECIFIC REQUIREMENT OF LAW. ASSESSEE SHOULD KNOW THE GROUNDS ON WHICH HE HAS CHARGED SPECIFIC OTHERWISE OPPORTUNITIES OF NATU RAL JUSTICE DENIED. ON THE BASIS OF SUCH PROCEEDINGS NO PENALTY COULD BE IMPOSED TO THE ASSESSEE. TAKING UP THE PENALTY PROC EEDINGS ON ONE LIMB AND FINDING THE ASSESSSEE IN ANOTHER LIMB IS BA D IN LAW. THOUGH IN THE INSTANT APPEAL THE LD. A.O HAS MADE PR OPER SATISFACTION IN THE BODY OF THE ASSESSMENT ORDER BUT IN THE NOTICE ISSUED U/S 274 R.W.S. 271(1)(C) OF THE ACT HE FAILED TO MENTION THE LIMBS FOR WHICH PENALTY PROCEEDINGS HAVE BEEN INITI ATED. IT IS THE NEGLIGENCE OF THE LD. A.O IN NOT MAKING PROPER SPECI FIC CHARGE IN THE NOTICE U/S 274 ABOUT THE ADDITION FOR WHICH PENALTY PROCEEDINGS HAVE BEEN INITIATED. LD. A.O SHOULD BE CLEAR AS TO WH ETHER THE ALLEGED ADDITION GOES UNDER THE LIMB OF CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHING INACCURATE PARTICULARS OF IN COME. MERELY ISSUING NOTICE IN GENERAL PROFORMA WILL NEGATE THE VERY PURPOSE OF NATURAL JUSTICE AS HELD BY THE HON'BLE APEX COURT IN THE CASE OF DILIP N SHRAF 161 TAXMANN 218 THAT THE QUASI- CRIMINAL P ROCEEDINGS U/S 271(1)(C) OF THE ACT OUGHT TO COMPLY WITH THE PRINC IPLES OF NATURAL JUSTICE. 14. WE THEREFORE RESPECTFULLY FOLLOWING ABOVE REFER RED JUDGMENTS AND IN THE GIVEN FACTS AND CIRCUMSTANCES OF THE CASE ARE OF THE CONSIDERED VIEW THAT THE ALLEGED NOTICE ISSUED U/S 274 R.W.S. 271(1)(C) OF THE ACT DATED 31.12.10 IS INVALID, UNTE NABLE AND SUFFERS FROM THE INFIRMITY OF NON APPLICATION OF MIND BY THE ASSESSING OFFICER. WE ACCORDINGLY DIRECT TO DELETE THE PENALTY OF RS.16,00,000/- IMPOSED U/S 271(1)(C) ON THIS GROUND ITSELF. WE ACCO RDINGLY ALLOW THE ADDITIONAL GROUND RAISED BY THE ASSESSEE ON THE LE GALITY OF THE PENALTY PROCEEDINGS INITIATED U/S 271(1)(C) OF THE A CT. SINCE THE PENALTY U/S 271(1)(C) ALSO HAS BEEN DEALT ON THE PR ELIMINARY POINTS [ITA NO.273/IND/2019] [SANGEETA MANAGEMENT CONSULTANCY P. LTD. ] 13 OTHER ARGUMENTS OF THE ASSESSEE DEALING WITH THE ME RITS OF THE LEVY OF PENALTY ARE NOT BEEN DEALT WITH, AS THE SAME ARE RENDERED ACADEMIC IN NATURE AND THE APPEAL OF THE ASSESSEE FO R THE ASSESSMENT YEAR 2008-09 IS ALLOWED. 12. SINCE THE FACTS IN THE INSTANT APPEAL ARE SIMILAR TO THOSE ADJUDICATED BY US IN THE CASE OF VARAD MEHTA (SUPRA), WE THEREFORE RESPECTFULLY FOLLOWING ABOVE REFERRED JUDGMENTS AND IN THE GIVEN FACTS AND CIRCUMSTANCES OF T HE CASE ARE OF THE CONSIDERED VIEW THAT THE ALLEGED NOTIC E ISSUED U/S 271(1)(C) OF THE ACT IS INVALID, UNTENABLE AND SUFFERS FROM THE INFIRMITY OF NON APPLICATION OF MIN D BY THE ASSESSING OFFICER. SINCE WE HAVE HELD THE NOTICE U/ S 274 OF THE ACT AS INVALID, THE SUBSEQUENT PROCEEDING U/S 271( 1)(C) OF THE ACT ARE THUS HELD TO BE VOID AB INITIO. WE ACCORDINGLY ALLOW THE LEGAL GROUND RAISED BY THE ASSESSEE ON THE LE GALITY OF THE PENALTY PROCEEDINGS INITIATED U/S 271(1)(C) OF THE ACT. SINCE THE PENALTY U/S 271(1)(C) ALSO HAS BEEN DEALT ON THE PRELIMINARY POINTS OTHER ARGUMENTS OF THE ASSESSEE [ITA NO.273/IND/2019] [SANGEETA MANAGEMENT CONSULTANCY P. LTD. ] 14 DEALING WITH THE MERITS OF THE LEVY OF PENALTY ARE NOT BEEN DEALT WITH, AS THE SAME ARE RENDERED ACADEMIC IN NATURE. THUS GROUNDS RAISED ON MERITS ARE DISMISSED AS INFRUCTUOUS. APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. 13. IN THE RESULT APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 19 .02. 2020. SD/- (MANISH BORAD) SD/- (KUL BHARAT) A CCOUNTANT MEMBER JUDICIAL MEMB ER INDORE; DATED :19/02/2020 PATEL/PS COPY TO: ASSESSEE/AO/PR. CIT/ CIT (A)/ITAT (DR)/GUAR D FILE. BY ORDER ASSISTANT REGISTRAR, INDORE