Prasanna Kumar Patra, Puri V. ItO, Puri Ward, Puri

ITA 339/CTK/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 1898 (ITAT-CUTTACK)
• Duration Of Justice: 1 year(s) 1 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-12-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 22-10-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P R MOHANTY
• Keywords: Invalid notice; Principle of natural justice; Question of law
• Section: 271(1)(c); 274; 73; 147; 148

Judgement Text

P A G E 1 | 10 IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK BEFORE SHRI CHANDRA MOHAN GARG , JUDICIAL MEMBER AND LAXMI PRASAD SAHU, ACCOUNTANT MEMBER ITA NO . 339 /CTK/201 9 ASSESSMENT YEAR : 2011 - 12 PRASANNA KUMAR PATRA, MAHODADHI MARKET BUILDING, MOCHI SAHI, PURI. VS. ITO, PURI WARD, PURI. PAN/GIR NO. AASPP 9347 D (APPELLANT ) .. ( RESPONDENT ) ASSESSEE BY : SHRI P.R.MOHANTY , AR REVENUE BY : SHRI SUBHENDU DUTTA, DR DATE OF HEARING : 25 / 1 1 / 20 20 DATE OF PRONOUNCEMENT : 07 / 1 2 /20 20 O R D E R PER C.M.GARG,JM THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A), 2 , BHUBANESWAR DATED 22.4.2019 FOR THE ASSESSMENT YEAR 2011 - 12 . 2. THE APPEAL IS TIME BARRED BY 96 DAYS. THE ASSESSEE HAS FILED CONDONATION PETITION, STATING THE REASONS THAT DUE TO NEGLIGENCE AND INACTION OF THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE, THE APPEAL COULD NOT BE FILED WITHIN THE STIPULATED PERIOD, RESULTANTLY, THERE WAS DELAY OF 96 ITA NO.339/CTK/2019 ASSESSMENT YEAR : 2011 - 12 P A G E 2 | 10 DAYS. IT IS STATED THAT THE DELAY IN FILING THE APPEAL WAS NEITHER DELIBERATE NOR INTENTIONAL, HENCE, PRAYED FOR CONDONING THE DELAY. 3. AFTER HEARING THE RIVAL SUBMISSIONS, WE ARE CONVINCE D THAT THERE WAS SUFFICIENT REASONS FOR NOT FILING THE APPEAL BEFORE THE TRIBUNAL BY THE ASSESSEE. HENCE, WE CONDONE THE DELAY AND ADMIT THE APPEAL FOR ADJUDICATION. 4 . IN THE GROUNDS OF APPEAL, THE GRIEVANCE OF THE ASSESSEE IS THAT THE LD CIT(A) IS NOT J USTIFIED IN CONFIRMING THE PENALTY LEVIED U/S.271(1)(C) OF THE I.T.ACT, 1961. 5 . AT THE OUTSET, LD AUTHORISED REPRESENTATIVE OF THE ASSESSEE SUBMITTED THAT IN THE PENALTY ORDER, THE ASSESSING OFFICER HAS IMPOSED PENALTY OF RS.5,38,480/ - AFTER INITIATING PENALTY PROCEEDINGS U/S.271(1)(C) FOR CONCEALMENT OF INCOME AND FOR FURNISHING INACCURATE PARTICULARS OF INCOME IN RESPECT OF THE ADDITIONS MADE AMOUNTING TO RS.17,05,527/ - . LD COUNSEL FOR THE ASSESSEE SUBMITTED THAT IN THIS CASE, NOTICE U/S 274 R.W.S. 271 WAS ISSUED ON 6.4.2014 AND THE INAPPROPRIATE WORDS IN THE SAID NOTICE HAVE NOT BEEN STRUCK OFF. THEREFORE, IT IS NOT UNDERSTOOD AS TO UNDER WHICH LIMB OF PROVISIONS OF SECTION 271(1)(C) OF THE ACT, THE ASSESSING OFFICER HAS LEVIED PENALTY. SINCE THE SAID SHOW CAUSE NOTICE ISSUED U/S 274 DID NOT SPECIFY THE CHARGE AGAINST THE ASSESSEE AS TO WHETHER IT WAS FOR CONCEALING THE PARTICULARS OF INCOME OR FOR FURNISHING INACCURATE PARTICULARS OF INCOME, ITA NO.339/CTK/2019 ASSESSMENT YEAR : 2011 - 12 P A G E 3 | 10 THEREFORE, THE PENALTY ORDER PASSED UNDER SECTION 271(1)(C) O F THE ACT IN PURSUANCE TO THE SAID NOTICE IS BAD IN LAW. HE REFERRED TO THE DECISION OF HONBLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS. MANJUNATHA COTTON & GINNING FACTORY REPORTED IN 359 ITR 565, WHICH DECISION HAS BEEN UPHELD BY THE HONBLE APEX CO URT IN CASE OF CIT VS. SSAS EMERALD MEADOWS (2016) 73 TAXMAN.COM 248 (SC). THEREFORE, IT WAS HIS CONTENTION THAT THE PENALTY ORDER DESERVES TO BE QUASHED. 6. LD A.R. RELIED ON THE DECISION OF ITAT DELHI BENCH IN THE CASE OF M/S. LODHI PROPERTY COMPAN Y LTD VS ACIT IN ITA NO.1232/DEL/2016 FOR A.Y. 2003 - 04 ORDER DATED 28.2.2019 AND ITAT BANGALORE BENCH B BENCH IN THE CASE OF ITO VS TRIAD RESORTS AND HOTELS PVT LTD., AND OTHERS IN ITA NO.3324/BAN/2018 ORDER DATED 28.6.2019 AND SUBMITTED THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY BOTH THE DECISIONS. 7 . ON THE OTHER HAND, LD D.R. SUPPORTED THE PENALTY ORDER AS WELL AS THE ORDER OF THE LD CIT(A). LD D.R. SUBMITTED THAT THE ASSESSEE HAS NEVER RAISED THE QUESTION OF INVALID NOTICE BEFORE THE LOW ER AUTHORITIES, HENCE, THIS ISSUE CANNOT BE AGAIN AGITATED BEFORE THE TRIBUNAL. FOR THIS PROPOSITION, L D D.R. RELIED ON THE DECISION OF HONBLE MADRAS HIGH COURT IN THE CASE OF SUNDARAM FINANCE LTD VS CIT (2018) 403 ITR 407 (MAD), IN WHICH SLP HAS ALSO BE EN DISMISSED BY HONBLE SUPREME COURT REPORTED IN (2018) 99 TAXMANN.COM 152 (SC). ITA NO.339/CTK/2019 ASSESSMENT YEAR : 2011 - 12 P A G E 4 | 10 8 . WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD, INTER ALIA, NOTICES U/S.274 READ WITH SECTION 271(1)(C) OF THE ACT DATED 6.3.2014 . WE FI ND THE ONLY ISSUE TO BE DECIDED IN THE GROUNDS OF APPEAL IS REGARDING IMPOSITION OF PENALTY LEVIED U/S 271(1)(C) OF THE ACT. WE FIND THAT IN THE PENALTY NOTICE INAPPROPRIATE WORDS HAVE NOT BEEN STRUCK OFF. EVEN THE LAST LINE OF THE SAID NOTICE ONLY SPE AKS OF SECTION 271 AND DOES NOT EVEN MENTION OF SECTION 271(1)(C) OF THE I.T. ACT. IT IS PERTINENT TO NOTE HERE THAT THE PENALTY ORDER IS BASED ON FURNISHING OF INACCURATE PARTICULARS BUT THE NOTICE IS NOT SPECIFYING EXACTLY ON WHICH LIMB THE PENALTY U/S 271(1)(C) HAS BEEN INITIATED. FROM THE NOTICE DATED 6 .3.2014, IT CAN BE SEEN THAT THE ASSESSING OFFICER WAS NOT SURE UNDER WHICH LIMB OF PROVISIONS OF SECTION 271 OF THE INCOME TAX ACT, 1961, THE ASSESSEE IS LIABLE FOR PENALTY. THEREFORE, THE ISSUE IS SQ UARELY COVERED BY THE DECISION OF THE HON'BLE SUPREME COURT IN CASE OF M/S SSA' EMERALD MEADOWS , 73 TAXMANN.COM 241 (SC) AND THE DECISION OF HONBLE KARANATAKA HIGH COURT IN THE CASE OF MANJUNATHA COTTON & GINNING FACTORY(SUPRA), WHEREIN, IT WAS HELD THAT NOTICE U/S.274 OF THE ACT SPECIFICALLY STATES AS TO WHETHER PENALTY IS BEING PROPOSED TO BE IMPOSED FOR CONCEALMENT OF PARTICULARS OF INCOME OR FOR FURNISHING INACCURATE PARTICULARS OF INCOME. ITA NO.339/CTK/2019 ASSESSMENT YEAR : 2011 - 12 P A G E 5 |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| 10 AND THE ASSESSEE, BEING A LIMITED COMPANY, HAV ING WIDE NETWORK IN VARIOUS FINANCIAL SERVICES, SHOULD DEFINITELY BE PRECLUDED FROM RAISING SUCH A PLEA AT THIS BELATED STAGE. 17. THUS, FOR THE ABOVE REASONS, SUBSTANTIAL QUESTIONS OF LAW NOS.1 AND 2 ARE ANSWERED AGAINST THE ASSESSEE AND IN FAVOUR OF THE REVENUE. THE ADDITIONAL SUBSTANTIAL QUESTION OF LAW, WHICH WAS FRAMED IS REJECTED ON THE GROUND THAT ON FACTS THE SAID QUESTION DOES NOT ARISE FOR CONSIDERATION AS WELL AS FOR THE REASONS SET OUT BY US IN THE PRECEDING PARAGRAPHS. 15. HOWEVER, WE ARE OF THE CONSIDERED VIEW THAT IN THE INSTANT CASE, NOT ONLY THE NOTICE ISSUED TO THE ASSESSEE UNDER SECTION 274 READ WITH SECTION 271(1)(C) IS DEFECTIVE BUT AO HAS NOT EVEN MADE HIMSELF SATISFIED AT THE TIME OF MAKING DISALLOWANCE / ADDITION IN ASSESSMENT ORDER IF THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF INCOME OR HAS CONCEALED PARTICULARS OF HIS INCOME RATHER TO BE ON THE SAFER SIDE HE HAS INVOKED BOTH THE LIMBS OF SECTION 271(1) OF THE ACT. NOT ONLY THIS, EVEN AT THE TIME OF PASSING THE PENALTY OR DER, AO WAS NOT CLEAR ENOUGH IF HE WAS LEVYING THE PENALTY ON ACCOUNT OF FURNISHING OF INACCURATE PARTICULARS OF INCOME OR FOR CONCEALMENT OF INCOME AS IS APPARENT FROM PARA 8 OF THE PENALTY ORDER. SO, WE ARE OF THE CONSIDERED VIEW THAT THIS IS NOT MERELY A CASE OF SERVING A DEFECTIVE NOTICE UNDER SECTION 274 READ WITH SECTION 271(1) ON THE ASSESSEE RATHER IT IS A CASE OF NON - APPLICATION OF MIND ON THE PART OF THE AO TO MAKE HIMSELF SATISFIED AS TO UNDER WHICH LIMB OF SECTION 271(1)(C) OF THE ACT, HE IS GOI NG TO INITIATE/LEVY THE PENALTY ON THE ASSESSEE. 20. IN VIEW OF WHAT HAS BEEN DISCUSSED ABOVE, THE CASE OF SUNDARAM FINANCE LTD. `(SUPRA), AS RELIED UPON BY LD. DR FOR THE REVENUE IS NOT APPLICABLE TO THE FACTS AND CIRCUMSTANCES OF THE CASE. HOWEVER, DECI SION RENDERED BY HONBLE APEX COURT IN CIT VS. SSAS EMERALA MEADOWS (SUPRA) AND HONBLE KARNATAKA HIGH COURT IN CIT VS. MANJUNATHA COTTON AND GINNING FACTORY (SUPRA) ARE SQUARELY APPLICABLE TO THE FACTS AND CIRCUMSTANCES OF THE CASE AS THE AO HAS MISERAB LY FAILED TO SPECIFY IN THE NOTICE ISSUED UNDER SECTION 274 READ WITH 271(L)(C) OF THE ACT, 'AS TO WHETHER THE ASSESSEE HAS CONCEALED THE PARTICULARS OF HIS INCOME OR HAS FURNISHED INACCURATE PARTICULARS OF SUCH INCOME, SO IN THESE CIRCUMSTANCES, PENALTY LEVIED BY THE AO AND CONFIRMED BY LD. CIT (A) IS NOT SUSTAINABLE IN THE EYES OF LAW. CONSEQUENTLY, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. 1 0 . WE FIND THAT IN THE CASE OF TRIAD RESORTS AND HOTELS PVT LTD (SUPRA), THE TRIBUNAL IN PARAS 8,9,10,11 AND 12 OBSERVED AS UNDER: 8. AS PER THE ABOVE DISCUSSION PARTICULARLY CLAUSES (P) TO (S) OF PARA 63 OF THIS JUDGMENT AS REPRODUCED ABOVE, WE ARE SATISFIED THAT IN THE FACTS OF ITA NO.339/CTK/2019 ASSESSMENT YEAR : 2011 - 12 P A G E 7 | 10 PRESENT CASE, THIS JUDGMENT OF HON'BLE KARNATAKA HIGH COURT IS SQUARELY APPLICABLE AND THEREFORE, WE FIND NO INFIRMITY IN THE ORDER OF CIT(A) AS PER WHICH HE HAS DELETED THE PENALTY BY RESPECTFULLY FOLLOWING THIS JUDGMENT OF HON'BLE KARNATAKA HIGH COURT RENDERED IN THE CASE OF CIT VS. MANJUNATHA COTTON AND GINNING FACTORY (SUPRA). 9. HAVING HELD SO, NOW WE EXAMI NE THE APPLICABILITY OF VARIOUS JUDGMENTS CITED BY LD. DR OF REVENUE. THE FIRST JUDGMENT CITED BY HIM IS THE JUDGMENT OF HONBLE APEX COURT RENDERED IN THE CASE OF SUNDARAM FINANCE LTD. VS. DCIT (SUPRA) AND ALSO THE JUDGMENT OF HONBLE MADRAS HIGH COURT IN THE SAME CASE AS REPORTED IN 403 ITR 407. PARA NOS. 16 AND 17 OF THIS JUDGMENT OF HONBLE MADRAS HIGH COURT RENDERED IN THE CASE OF SUNDARAM FINANCE LTD. VS. CIT (SUPRA) ARE RELEVANT AND HENCE, WE REPRODUCE THESE PARAS FROM THIS JUDGMENT. 16. WE HAVE PE RUSED THE NOTICES AND WE FIND THAT THE RELEVANT COLUMNS HAVE BEEN MARKED, MORE PARTICULARLY, WHEN THE CASE AGAINST THE ASSESSEE IS THAT THEY HAVE CONCEALED PARTICULARS OF INCOME AND FURNISHED INACCURATE PARTICULARS OF INCOME. THEREFORE, THE CONTENTION RAIS ED BY THE ASSESSEE IS LIABLE TO BE REJECTED ON FACTS. THAT APART, THIS ISSUE CAN NEVER BE A QUESTION OF LAW IN THE ASSESSEES CASE, AS IT IS PURELY A QUESTION OF FACT. APART FROM THAT, THE ASSESSEE HAD AT NO EARLIER POINT OF TIME RAISED THE PLEA THAT ON AC COUNT OF A DEFECT IN THE NOTICE, THEY WERE PUT TO PREJUDICE. ALL VIOLATIONS WILL NOT RESULT IN NULLIFYING THE ORDERS PASSED BY STATUTORY AUTHORITIES. IF THE CASE OF THE ASSESSEE IS THAT THEY HAVE BEEN PUT TO PREJUDICE AND PRINCIPLES OF NATURAL JUSTICE WERE VIOLATED ON ACCOUNT OF NOT BEING ABLE TO SUBMIT AN EFFECTIVE REPLY, IT WOULD BE A DIFFERENT MATTER. THIS WAS NEVER THE PLEA OF THE ASSESSEE EITHER BEFORE THE ASSESSING OFFICER OR BEFORE THE FIRST APPELLATE AUTHORITY OR BEFORE THE TRIBUNAL OR BEFORE THIS C OURT WHEN THE TAX CASE APPEALS WERE FILED AND IT WAS ONLY AFTER 10 YEARS, WHEN THE APPEALS WERE LISTED FOR FINAL HEARING, THIS ISSUE IS SOUGHT TO BE RAISED. THUS ON FACTS, WE COULD SAFELY CONCLUDE THAT EVEN ASSUMING THAT THERE WAS DEFECT IN THE NOTICE, IT HAD CAUSED NO PREJUDICE TO THE ASSESSEE AND THE ASSESSEE CLEARLY UNDERSTOOD WHAT WAS THE PURPORT AND IMPORT OF NOTICE ISSUED UNDER SECTION 274 R/W.SECTION 271OF THE ACT. THEREFORE, PRINCIPLES OF NATURAL JUSTICE CANNOT BE READ IN ABSTRACT AND THE ASSESSEE, BEING A LIMITED COMPANY, HAVING WIDE NETWORK IN VARIOUS FINANCIAL SERVICES, SHOULD DEFINITELY BE PRECLUDED FROM RAISING SUCH A PLEA AT THIS BELATED STAGE. 17. THUS, FOR THE ABOVE REASONS, SUBSTANTIAL QUESTIONS OF LAW NOS.1 AND 2 ARE ANSWERED AGAINST THE A SSESSEE AND IN FAVOUR OF THE REVENUE. THE ADDITIONAL SUBSTANTIAL QUESTION OF LAW, WHICH WAS FRAMED IS REJECTED ON THE GROUND THAT ON FACTS THE SAID QUESTION DOES NOT ARISE FOR CONSIDERATION AS WELL AS FOR THE REASONS SET OUT BY US IN THE PRECEDING PARAGRAP HS. ITA NO.339/CTK/2019 ASSESSMENT YEAR : 2011 - 12 P A G E 8 | 10 10. FROM THE ABOVE PARAS REPRODUCED FROM THIS JUDGMENT OF HONBLE MADRAS HIGH COURT RENDERED IN THE CASE OF SUNDARAM FINANCE LTD. VS. CIT (SUPRA), WE FIND THAT IN THAT CASE, THE ISSUE REGARDING DEFECT IN THE PENALTY NOTICE WAS NOT RAISED BY ASSESSEE IN THAT CASE BEFORE THE AO OR CIT(A) OR BEFORE THE TRIBUNAL OR EVEN BEFORE THE HONBLE HIGH COURT AND THIS QUESTION WAS RAISED AT THE TIME OF HEARING OF THE APPEAL BEFORE THE HONBLE HIGH COURT AND IT WAS NOTED BY HONBLE MADRAS HIGH COURT THAT THIS ISSUE IS RAISED AFTER 10 YEARS WHEN THE APPEALS ARE LISTED FOR FINAL HEARING AND THEREFORE, UNDER THESE FACTS, IT WAS HELD BY HONBLE MADRAS HIGH COURT THAT EVEN ASSUMING THAT THERE WAS DEFECT IN THE NOTICE, IT HAD CAUSED NO PREJUDICE TO THE ASSESSEE AND THE ASSES SEE CLEARLY UNDERSTOOD WHAT WAS THE PURPORT AND IMPORT OF NOTICE ISSUED UNDER SECTION 274 R.W. SECTION 271OF THE IT ACT. IN THE PRESENT CASE, THE FACTS ARE DIFFERENT BECAUSE THIS ISSUE WAS RAISED BY ASSESSEE BEFORE CIT(A) ALSO AND THEREFORE, IN OUR CONSIDE RED OPINION, THIS JUDGMENT OF HONBLE MADRAS HIGH COURT AND THE SUBSEQUENT JUDGMENT OF HONBLE APEX COURT IN THAT CASE AS PER WHICH SLP WAS DISMISSED ARE NOT APPLICABLE IN THE PRESENT CASE. 11. THE NEXT JUDGMENT CITED BY LD. DR OF REVENUE IS THE JUDGMENT OF HONBLE APEX COURT RENDERED IN THE CASE OF SKY LIGHT HOSPITALITY LLP VS. ACIT (SUPRA). IN THIS CASE, THE ISSUE INVOLVED WAS REGARDING DEFECTS IN THE NOTICE OF REASSESSMENT ISSUED BY THE AO U/S. 147 AND 148 OF IT ACT. THE NOTICE IN THAT CASE WAS ISSUED I N THE NAME OF ERSTWHILE COMPANY DESPITE COMPANY CEASING TO EXIST AS IT HAD BEEN CONVERTED INTO LLP AND UNDER THOSE FACTS, IT WAS HELD THAT SECTION 292B OF IT ACT IS APPLICABLE AND HENCE, THE DEFECT IN THE NOTICE CAN BE CURED BECAUSE ONLY WRONG NAME WAS GIV EN IN THE NOTICE. IT WAS HELD THAT IT WAS MERELY A CLERICAL ERROR WHICH COULD BE CORRECTED U/S. 292B OF IT ACT. IN THE PRESENT CASE, THE ISSUE INVOLVED IS REGARDING DEFECT IN PENALTY NOTICE AND THAT TOO NOT REGARDING DEFECT IN THE NAME BUT REGARDING THE DE FECT IN THE ALLEGATION AND HENCE, IN OUR CONSIDERED OPINION, THIS JUDGMENT IS ALSO NOT APPLICABLE IN THE PRESENT CASE. 12. THE NEXT JUDGMENT CITED BY LD. DR OF REVENUE IS THE JUDGMENT OF HONBLE KERALA HIGH COURT RENDERED IN THE CASE OF PARISONS ROLLER FL OUR MILLS (P) LTD. VS. CIT (SUPRA). FOUR QUESTION OF LAW WERE RAISED IN THAT CASE WHICH ARE AS UNDER. 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE HON'BLE TRIBUNAL WAS JUSTIFIED IN DIRECTING THE ASSESSING OFFICER TO RE - WORK THE QUANTUM OF PE NALTY IN TERMS OF THE ORDER OF THE HON'BLE HIGH COURT? 2. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE HON'BLE TRIBUNAL WAS JUSTIFIED IN DIRECTING THE ASSESSING OFFICER TO RECOMPUTE THE PENALTY WHEN THERE WAS NO CLEAR FINDING OF CONCEALMENT OF INCOME? ITA NO.339/CTK/2019 ASSESSMENT YEAR : 2011 - 12 P A G E 9 | 10 3.WHETHER THERE WERE MATERIALS BEFORE THE APPEL LATE TRIBUNAL TO COME TO A CONCLUSION THAT THERE IS A CONCEALMENT OF INCOME FOR LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT? 4. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE IS NOT THE ORDER OF PENALTY DATED 31.07.2008 BARRED BY LIMI TATION IN TERMS OF THE CBDT CIRCULAR REPORTED IN 290 ITR (ST) 86 WHICH IS BINDING ON THE ASSESSING OFFICER? 13. FROM THE QUESTIONS OF LAW RAISED BEFORE HONBLE KERALA HIGH COURT IN THAT CASE AS REPRODUCED ABOVE, IT IS SEEN THAT IN THAT CASE, THIS WAS N OT THE ISSUE IN DISPUTE THAT WHETHER THERE IS DEFECT IN THE NOTICE ISSUED BY THE AO U/S 274 R.W.S 271 OF THE I.T.ACT. 1 1 . WE FIND THAT THE ITAT DELHI IN THE CASE OF LODHI PROPERTY COMPANY LTD (SUPRA) HAS DEALT THE DECISION OF HONBLE MADRAS HIGH COURT I N THE CASE OF SUNDARAM FINANCE LTD (SUPRA) AND DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE. SIMILAR IS THE CASE IN THE PRESENT CASE. 1 2 . SINCE IN THE INSTANT CASE ALSO THE INAPPROPRIATE WORDS IN THE PENALTY NOTICE HAVE NOT BEEN STRUCK OFF AND THE NOTICE DOES NOT SPECIFY AS TO UNDER WHICH LIMB OF THE PROVISIONS, THE PENALTY U/S 271(1)(C) HAS BEEN INITIATED, THEREFORE, WE ARE OF THE CONSIDERED OPINION THAT THE LD CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE PENALTY LEVIED U/S 271(1)(C) OF THE ACT. HENCE, W E QUASH THE PENALTY ORDER AND ALLOW THE APPEAL OF THE ASSESSEE. 1 3 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON 07 /1 2 /20 20 . S D/ - SD/ - (LAXMI PRASAD SAHU) ( CHANDRA MOHAN GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER CUTTACK; DATED 7 / 1 2 /20 20 ITA NO.339/CTK/2019 ASSESSMENT YEAR : 2011 - 12 P A G E 10 | 10 B.K.PARIDA, SPS COPY OF THE ORDER FORWARDED TO : BY ORDER SR . PVT. S ECRETARY ITAT, CUTTACK 1. THE RESPONDENT: PRASANNA KUMAR PATRA, MAHODADHI MARKET BUILDING, MOCHI SAHI, PURI. 2. THE RESPONDENT. ITO, PURI WARD, PURI 3. THE CIT(A) - 2, BHUBANESWAR 4. PR.CIT - 2 , BHUBANESWAR 5. DR, ITAT, CUTTACK 6. GUARD FILE. //TRUE COPY//