Konchada Sreeram, Visakhapatnam V. THE ITO, Visakhapatnam

ITA 388/VIZ/2015

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 6630 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 1 year(s) 10 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 10-11-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: Y SESHA SRINIVAS
• Keywords: Capital asset; Principle of natural justice; Question of law; Wrong claim
• Section: 143(3); 133A; 54

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . . , BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH , ACCOUNTANT MEMBER . / I . T .A.NO. 3 88 /VIZ/ 201 5 ( / ASSESSMENT YEAR: 200 7 - 0 8 ) KONCHADA SREERAM D.NO.25 - 1 - 12 NEAR READING ROOM VISAKHAPATNAM INCOME TAX OFFICER WARD - 1(1) VISAKHAPATNAM ( / APPELLANT) ( / RESPONDENT) / APPELLANT BY : SHRI. G.V.N.HARI, AR / RESPONDENT BY : SHRI Y.SESHA SRINIVAS, DR / DATE OF HEARING : 2 6 .0 9 .2017 / DATE OF PRONOUNCEMENT : 06 . 10 .2017 / O R D E R PER D.S. SUNDER SINGH , ACCOUNTANT MEMBER : THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) [CIT(A)] - 1 , VI SAKHAPATNAM VIDE ITA NO. 2 8/ 20 1 0 - 1 1/ITO, W - 1(1),VSP/2015 - 16 DATED 18 . 08 .201 5 PASSED U/S 271(1)(C) OF THE I.T.ACT, (ACT) 1961 FOR THE ASSESSMENT YEAR 2008 - 09. 2 ITA NO. 3 88 /VIZ/201 5 KONCHADA SREERAM , VISAKHAPATNAM ALL THE GROUND S OF THE APPEAL ARE RELATED TO THE LEVY OF PENALTY U/S 271(1)(C) OF THE ACT. THE ASSESSEE ALONG WITH APPEAL MEMO IN FORM NO.36 FILED FOUR GROUNDS ON MERITS. SUBSEQUENTLY, THE ASSESSEE FILED THE ADDITIONAL GROUND CHALLENGING THE VALIDITY OF ISSUE OF NOTICE U/S 271(1)(C) OF THE ACT . THE ASSESSEE HAS NOT FILED THE RETURN OF INCOME THOUGH THE DUE DATE FOR FILING RETURN OF INCOME WAS EXPIRED. T HEREFORE, THE ASSESSING OFFICER(AO) CONDUCTED A SURVEY U/S 133A ON 07 . 02 . 2009 AND COLLECTED THE INFORMATION REGARDING SALE OF PROPERTY AND THE RESULTANT CAPITAL GAINS. THE AS SESSMENT WAS COMPLETED U/S 143(3) ON TOTAL INCOME OF RS.16,17,641/ - ASSESSING THE LONG TERM CAPITAL GAINS ON SALE OF LAND ED PROPERTY AND INITIATED THE PENALTY U/S 271(1)(C) OF I.T.ACT , AND ACCORDINGLY ISSUED THE NOTICE U/S 271(1)(C) OF THE ACT . SUBSEQUENT LY, THE AO ISSUED SHOW CAUSE NOTICE AND THERE WAS NO RESPONSE FROM THE ASSESSEE HENCE THE AO IMPOSED THE PENALTY OF RS.3,36,071/ - BEING 100% OF TAX SOUGHT TO BE EVADED . AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE WENT ON APPEAL BEFORE THE CIT(A) AND TH E LD.CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE AND CONFIRMED THE PENALTY IMPOSED BY THE AO. AGAINST THE ORDER OF THE LD.CIT(A), T HE ASSESSEE FILED APPEAL BEFORE THIS TRIBUNAL RAISING THE FOLLOWING GROUNDS ALONG WITH APPEAL MEMO IN FORM NO.36. 1 . THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IS CONTRARY TO THE FACTS AND ALSO THE LAW APPLICABLE TO THE FACTS OF THE CASE. 3 ITA NO. 3 88 /VIZ/201 5 KONCHADA SREERAM , VISAKHAPATNAM 2. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IS NOT JUSTIFIED IN SUSTAINING THE PENALTY, OF RS 3,36,071/ - LEVIED BY THE ASSESSING OFFICER U/S 271(1) (C) OF THE INCOME TAX ACT, 1961. 3 . THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) OUGHT TO HAVE CONSIDERED THAT THERE IS NEITHER CONCEALMENT NOR FURNISHING OF INACCURATE PARTICULARS OF INCOME IN THE CASE OF TH E APPELLANT 4 . FOR ANY OTHER GROUND THAT MAY BE URGED AT THE TIME OF APPEAL HEARING SUBSEQUENTLY, THE ASSESSEE FILED PETIT I ON DATED 12.09.2017 REQUESTING FOR ADMISSION OF ADDITIONAL GROUND WHICH READS AS UNDER : WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE ORDER DT26 - 03 - 2010 LEVYING PENALTY U/S 271(1)(C) IS LIABLE TO BE CANCELLED IN AS MUCH AS THE NOTICE DT.13 - 07 - 2009 INITIATING THE PENALTY PROCEEDINGS DID NOT SPECIFY CLEARLY AS TO WHETHER THE PENALTY PROCEEDINGS WERE INITIATED FOR CONCEALMENT OF PARTICULARS OF INCOME OR FOR FURNISHING INACCURATE PARTICULARS OF INCOME.' 2. DURING THE APPEAL HEARING, THE LD.AR ARGUED THAT ORIGINALLY THE ASSESSEE HAD FILED THE APPEAL AGAINS T THE ORDER OF THE CIT(A) ON MERITS. SUBSEQUENTLY, THE HONBLE HIGH COURT OF AP IN I.T.T.A.NO.684/2016 IN PRINCIPA C.I.T - 1, VISAKHAPATNAM VS SMT. BAISETTY REVATHI HAS ANSWERED A QUESTION WITH REGARD TO VALIDITY OF THE NOTICE ISSUED U/S 271(1)(C) WITHOUT STRIKING OFF IRRELEVANT COLUMN OF PRE PRINTED NOTICE I.E WHETHER THE PENALTY INITIATED FOR FURNISHING THE INACCURATE PARTICULARS OR FOR THE CONCEALMENT OF INCOME , LEAVING THE ASSESSEE IN A CONFUSED STATE OF AFFAIR S FOR WHICH LIMB OF THE NOTICE THE ASSESSEE IS REQUIRED TO FURNISH THE EXPLANATION ? THE LD.AR SUBMITTED THAT T HE HONBLE HIGH COURT HELD IN THE CITED JUDGEMENT THAT THE 4 ITA NO. 3 88 /VIZ/201 5 KONCHADA SREERAM , VISAKHAPATNAM NOTICE ISSUED WITHOUT STRIKING IRRELEVANT COLUMN IN THE NOTICE ISSUED U/S 271(1)(C) HELD TO BE INVALID. THIS VIEW WAS SUPPORTED BY THE ORDER OF HONBLE HIGH COURT OF KARNATAKA IN THE CASE OF MANJUN ATHA COTTON AND GINNING FACTORY. THEREFORE THE LD.A.R ARGUED THA T IN THE ASSSESSEES CASE ALSO, THE AO HAD ISSUED NOTICE U/S 271( 1 )(C) WITHOUT PUTTING THE ASSESSEE O N NOTICE FOR WHICH LIMB OF THE NOTICE, I.E. WHETHER FOR FURNISHING OF INADEQUATE PARTICULARS OR FOR CONCEALMENT OF INCOME, THE ASSESSEE IS REQUIRED TO FUR NISH THE EXPLANATION. HENCE, LD.AR ARGUED THAT THE A DDITIONAL GROUND GOES TO THE ROOT OF THE PENALTY HENCE REQUESTED FOR ADMISSION. THE LD .D.R OBJECTED FOR ADMISSION OF THE ADDITIONAL GROUND. 3. WE HAVE HEA RD BOTH THE PARTIES AND WE ARE OF THE VIEW TH AT THER E IS MERIT IN THE SUBMISSIONS MADE BY THE LD.A.R AND ADMIT THE ADDITIONAL GROUND. 4. DURING THE APPEAL HEARING, THE LD.AR REITERATED THE SUBMISSIONS MADE AT THE TIME OF ADMISSION OF ADDITIONAL GROUND AND SUBMITTED THAT IT IS OBLIGATORY ON THE P ART OF THE AO TO ISSUE THE NOTICE FOR WHICH LIMB OF THE OFFENCE, THE ASSESSEE IS REQUIRED TO FURNISH THE EXPLANATION. THE AO MUST BE SATISFIED THAT A PERSON HAS EITHER CONCEALED THE PARTICULARS OF INCOME OR 5 ITA NO. 3 88 /VIZ/201 5 KONCHADA SREERAM , VISAKHAPATNAM FURNI SHED THE INACCURATE PARTICULARS AND IT SHOULD BE MADE KNOWN TO THE ASSESSEE IN THE NOTICE CALLING FOR EXPLANATION. LD.AR REFERRING TO THE NOTICE ISSUED BY THE AO DEMONSTRATED THAT THE AO HAS NOT MADE THE ASSESSEE TO BE KNOW N FOR WHICH OFFENCE, THE ASSESSEE REQUIRED TO FURNISH EXPLANATION. T HE ASSESSING OFFICER ISSUED NOTICE U /S 271(1)(C) R.W.S. 274 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 INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME 4 .1. FROM THE NOTICE, IT IS OBSERVED THAT THE AO IS NOT SURE FOR WHICH LIMB OF THE NOTICE, THE AO SOUGHT EXPLANATION FROM THE ASS ESSEE. THEREFORE, LD.AR ARGUED THAT THE CASE OF THE ASSESSEE IS SQUARELY COVERED BY THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT CIT ED SUPRA AND THE DECISION OF THIS TRIBUNAL IN ITA NO.229/VIZ/2015. HENCE PENALTY IMPOSED BY THE AO WITHOUT STRIKING THE IRRELEVANT COLUMN IS UNSUSTAINABLE AND REQUESTED TO CANCEL THE PENALTY. 5 . ON THE OTHER HAND, LD.DR REFERRING TO HONBLE HIGH COURT OF AP & TS JUDGEMENT CITED IN PAGE N O. 10 ARGUED THAT THE CASE OF THE ASSESSEE IS DISTINGUISHABLE ON FACTS AND THE HONBLE HIGH COURT OBSERV ED AS UNDER: 6 ITA NO. 3 88 /VIZ/201 5 KONCHADA SREERAM , VISAKHAPATNAM FURTHER, THE PENALTY ORDER DEMONSTRATES THAT THE ASSESSING OFFICER WAS NOT EVEN CERTAIN AS TO WHAT WAS THE FINDING ON THE STRENGTH OF WHICH HE IMPOSED THE PENALTY. THIS IS CLEAR FROM THE FACT THAT THE ASSESSING OFFICER RECORDED THAT HE WAS S ATISFIED THAT THE ASSESSEE HAD CONCEALED / FURNISHED INACCURATE PARTICULARS OF INCOME. IN THE ABSENCE OF A CLEAR FINDING BY THE ASSESSING OFFICER HIMSELF, THE BENEFIT OF DOUBT CANNOT BE GIVEN TO THE REVENUE MERELY BECAUSE THE ASSESSEE DID NOT COMPLAIN OF VAGUENESS IN THE SHOW - CAUSE NOTICE EARLIER 5.1. THE L D.DR ARGUED THAT IN THE INSTANT CASE THE AO HAS GIVEN A CLEAR FINDING IN THE PENALTY ORDER THAT THE PENALTY WAS IMPOSED FOR CONCEALMENT OF INCOME BY FURNISHING F ALSE EVIDENCES AND BOGUS CLAIMS IN PAGE NO. 3 PARA NO. 2.3. WHICH READS AS UNDER: THOUGH THE FACTS OF THE CASE IT IS NOTICED THAT THE ASSESSEE HAS SOLD CAPITAL ASSET AND RECEIVED THE SALE CONSIDERATION. THE SALE WAS COMPLETED ON 12 . 10 . 2006 AND 07 . 03 . 2007 RESPECTIVELY. THE SALE CONSIDERATI ON WAS CHARGEABLE TO CAPITAL GAINS TAX BUT THE ASSESSEE HAS NOT FILED THE RETURN OF INCOME EVEN AFTER THE DUE DATE TILL SUCH TIME THE SURVEY WAS CONDUCTED ON 07.02.2008, THE ISSUE REGARDING THE CAPITAL GAINS COULD NOT HAVE COME TO THE NOTICE OF THE DEPARTM ENT ONLY AFTER CONDUCTING THE SURVEY, THE ASSESSEE HAS FILED THE RETURNS THAT TOO ADMITTING NIL INCOME IN THE RETURN AGAINST THE TAXABLE INCOME UNDER CAPITAL GAINS TO THE EXTENT OF RS 15,43,041/ - IN THE RETURN OF INCOME THE ASSESSEE HAS MADE FALSE CLAIMS W ITHOUT ANY EVIDENCES EVIDENCING THAT THE LAND SOLD WAS AGRICULTURAL LAND, SIMILARLY THE ASSESSEE HAS ALSO NOT PRODUCED ANY EVIDENCE REGARDING THE PURCHASE OF AGRICULTURAL LAND. DURING THE COURSE OF SURVEY ALSO THE ASSESSEE HAS NOT STATED ANYTHING REGARDING THE INVESTMENT IN AGRICULTURAL LAND THE ASSESSEE HAS NOT PRODUCED ANY EVIDENCE CLAIMING THAT THE SALE CONSIDERATION WAS INVESTED IN SPECIFIED DEPOSITS AS REQUIRED UNDER SECTION 54 B OF THE I.T. ACT. THEREFORE THE CLAIM OF INVESTMENT IN AGRICULTURAL LAND, DEDUCTION U/S.54B IS NOTHING BUT FALSE WITHOUT ANY BASIS TO AVOID CAPITAL GAINS TAXES. IN VIEW OF THE ABOVE, THIS IS A CLEAR CASE OF CONCEALMENT OF INCOME BY FURNISHING FALSE EVIDEN CES AND BOGUS CLAIMS WHICH ATTRACTS PENALTY U/S.271(1)(C). 5 . 2 . THEREFORE, ACCORDING TO THE LD.DR THE CASE IS DISTINGUISHABLE AND BENEFIT OF DOUBT SHOULD BE GIVEN TO THE REVENUE BUT NOT TO THE ASSESSEE , SINCE THE PENALTY ORDER IS VERY CLEAR WITH REGARD T O THE CONCEALMENT OF INCOME . RESPONDING TO THE ARGUMENT OF THE L D.DR, LD. AR REFERRING TO PAGE 7 ITA NO. 3 88 /VIZ/201 5 KONCHADA SREERAM , VISAKHAPATNAM NO.7 OF THE JUDGEMENT OF THE HONBLE HIGH COURT OF AP ARGUED THAT T HE RATIO LAID DOWN BY THE H ONBLE H IGH C OURT IS ON THE ISSUE OF NOTICE BUT NOT ON THE PENALT Y ORDER. IN THE CASE OF THE ASSESSEE, THE NOTICE ISSUED BY THE AO IS IDENTICAL TO THE FACTS OF THE ASSESSEE AND THE HONBLE HIGH COURT OF AP CONSIDERING THE DECISION OF MANJUNATHA COTTON AND GINNING FACTORY AND THE DECISION OF THE GUJARAT HIGH COURT IN THE CASE OF MANU ENGINEERING WORKS AND ALSO THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF K.P.MADHUSUDHANAN VS. COMMISSIONER OF INCOME, TAX HELD THAT THE PENALTY PROCEEDINGS SOUGHT TO BE INITIATED B Y THE REVENUE U/S 271(1)(C) OF THE I.T.ACT, 1961 SHOULD BE ON SPECIFIC GROUND WHICH FORMS THE FOUNDATION HAS TO BE SPEL T OUT IN CLEAR TERMS. OTHERWISE, THE ASSESSEE WOULD NOT HAVE AN OPPORTUNITY TO PUT FORTH HIS DEFENSE . WHEN THE CHARGING IS CONCEALMENT O F INCOME OR FURNISHING OF INACCURATE PARTICULARS THEREOF, THE REVENUE MUST SPECIFY AS TO WHICH ONE OF TWO IS SOUGHT TO BE PRESSED INTO SERVICE AND CANNOT BE PERMITTED TO CLUB BOTH BY INTERJECTING AN OR BETWEEN THE TWO. ACCORDINGLY, LD.AR F URTHER ARGUED THAT RATIO LAID DOWN BY THE HONBLE HIGH COURT IS BINDING ON THE LOWER COURTS, BUT NOT THE PASSING REMARK S OR OBSERVATIONS. . THE LD.AR ARGUED THAT THE CASE IS SQUARELY COVERED BY THE DECISION OF THE HONBLE HIGH COURT AND REQUESTED TO QUASH THE NOTICE I SSUE D U/S 271(1)(C). 8 ITA NO. 3 88 /VIZ/201 5 KONCHADA SREERAM , VISAKHAPATNAM 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, TH E AO HAS INITIATED 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 FURNISHING 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 PER THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT CITED , FOR STARTING THE PENALTY PROCEEDINGS, THE CONDITION 9 ITA NO. 3 88 /VIZ/201 5 KONCHADA SREERAM , VISAKHAPATNAM PRECEDENT IS THAT THE ASSESSING OFFICER MUST BE SATISFIED THAT A PERSON HAS EITHER CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME. THE PERSON WHO IS 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 CONT EST SUCH PROCEEDINGS AND SHOULD HAVE THE FULL OPPORTUNITY 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 PRESU MPTION IS SERIOUS IN NATURE AND HAS TO PAY THE PENALTY 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 SPECIFICALLY, 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 ARGUMENT THAT THE CASE IS DISTINGUISHABLE ON FACTS IS NOT ACCEPTABLE 10 ITA NO. 3 88 /VIZ/201 5 KONCHADA SREERAM , VISAKHAPATNAM 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 NOTIC E 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. T HE ASSESSING OFFICER DID NOT STRIKE OFF THE IRRELEVANT COLUMN IN THE NOTICE AND MAD E KNOWN THE ASSESSEE WH E THER THE PENALTY WA S INITIATED FOR THE CONCEALMENT OF INCOME 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 NO R IN THE PENALTY NOTIC E, THE ASSESSING OFFICER HAS PUT THE ASSESSEE O N 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 PRINCIPLE, 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 THER EFORE HAS TO BE SPELT OUT IN CLEAR TERMS OTHERWISE , ON A S SESEE WOULD NOT HAVE PROPER OPPORTUNITY TO PUT FORTH HIS DEFENCE. WHEN THE PROCEEDINGS ARE PENAL IN NATURE RESULTING IN IMPOSI TION OF PENALTY RANGING FROM 10 0% TO 300% OF THE TAX LIABILITY, THE CHARGE MUS T BE UNEQUIVOCAL AND UNAMBIGUOUS. WHEN THE CHARGE IS EITHER CONCEALMENT OF PARTICULARS 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 PERMITT ED 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. 11 ITA NO. 3 88 /VIZ/201 5 KONCHADA SREERAM , VISAKHAPATNAM WE ARE THEREFORE OF THE OPINION THAT THE ORDER UNDER APPEAL DOES NOT BROOK INTERFERENCE ON ANY GROUND. WE FIND NO QUESTION OF LAW, MUCH LESS A SUBSTANTIAL ONE, ARISING FOR CONSIDERATION WARRAN TING ADMISSION OF THIS APPEAL. 6 .2. ON THE SIMILAR FACTS, THE COORDINATE BENCH OF ITAT, VISAKHAPATNAM IN ITA NO.229/VIZ/2015 IN THE CASE 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 ISSUED U/S 271 A S 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. 7 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. T HE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 6 TH OCT 20 17 . SD/ - SD/ - ( . ) ( . . ) (V. DURGA RAO) ( D.S. SUNDER SINGH ) /JUDICIAL MEMBER /ACCOUNTANT MEMBER /VISAKHAPATNAM /DATED : 06. 10 .2017 L. RAMA, SPS 12 ITA NO. 3 88 /VIZ/201 5 KONCHADA SREERAM , VISAKHAPATNAM /COPY OF THE ORDER FORWARDED TO: - 1. / THE APPELLANT KONCHADA SREERAM , D.NO.25 - 1 - 12, NEAR READING ROOM, VISAKHAPATNAM 2 . / THE RESPONDENT INCOME TAX OFFICER , WARD - 1(1), VISAKHAPATNAM 3 . THE COMMISSIONER OF INCOME TAX - 1, VISAKHAPATNAM 4. THE COMMISSIONER OF INCOME TAX (APPEALS), VISAKHAPATNAM 5 . , , / DR, ITAT, VISAKHAPATNAM 6 . / GUARD FILE / BY ORDER // TRUE COPY // SR. PRIVATE SECRETARY ITAT, VISAKHAPATNAM