LATE SHASHIRAJ KAPOOR (THROUGH LEGAL REPRESENTIVE KUNAL KAPOOR), MUMBAI V. ACIT ,CIRCLE- 16 (1), MUMBAi

ITA 5913/MUM/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 2630 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2013-2014
• Appeal Filed On: 15-10-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Principle of natural justice; Revised return; Set aside
• Section: 271(1)(c); 143(3); 142(1); 201; 274; 143(2); 13; 54

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI BEFORE SHRI RAJESH KUMAR , AM AND SHRI AMARJIT SINGH, JM / I .T.A. NO. 5913 /MUM/20 1 8 ( / ASSESSMENT YEAR: 2013 - 14 ) LATE SHASHIRAJ KAPOOR (THROUGH LEGAL REPRESENTATIVE KUNAL KA POOR) 6, PRITHVI THEATRE, JANTA KUTIR JUHU CHURCH ROAD, JUHU, MUMBAI - 400049 . / VS. ACIT CIRCLE 16(1) 439, AAYAKAR BHAVAN, MUMBAI - 400020. ./ ./ PAN/GIR NO. : AABPK0578J ( / APPEL LANT ) .. ( / RESPONDENT ) / DATE OF HEARING : 03 /1 2 / 201 9 / DATE OF PRONOUNCEMENT : 29 /01 / 2020 / O R D E R PER AMARJIT SINGH, J M: THE ASSESSEE HAS FILED THE PRESENT APPEAL AGAINST THE ORDER DATED 02 . 08 .201 8 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) - 4 , MUMBAI [HEREINAFTE R REFERRED TO AS THE CIT(A)] RELEVANT TO THE A.Y. 2013 - 1 4 IN WHICH THE PENALTY LEVIED BY THE AO HAS BEEN ORDER ED TO BE CONFIRMED . 2 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS: - ASSESSEE BY : MR. FIROZ ANDH YARUJINA REVENUE BY: SHRI V. VINOD KUMAR ( SR. A R) ITA. NO 5913 /M/201 8 A.Y. 20 13 - 14 2 1. THE LD. CIT(A) - 4 ERRED IN ERRED IN DISMISSING THE APPEAL MERELY ON A TECHNICAL REASON THAT THE SAME WAS FILED MANUALLY INSTEAD ON FILING THE APPEAL ELECTRONICALLY. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED ASSESSING OFFICER ERRED IN LEVYING PENALTY U/S 271(1)(C) OF THE INCOME TAX ACT, 1961 AMOUNTING TO RS 26,10,000/ - . 3. ON T HE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED ASSESSING OFFICER ERRED IN LEVYING PENALTY U/S 271(1)(C) W.R.T. ADDITION OF RS1,08,07,020/ - WITHOUT APPRECIATING THE FACT THAT THE APPELLANT HAD SUO MOTO REVISED ITS COMPUTATION OF INCOME AN D OFFERED THE SAME TO TAX WITHOUT ANY DISCOVERY BY THE LEARNED ASSESSING OFFICER. 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED ASSESSING OFFICER ERRED IN LEVYING PENALTY U/S 271(1)(C) W.R.T. ADDITION OF RS 18,22,123/ - WITHOUT AP PRECIATING THE FACT THE SAID ADDITION WAS NOT CHALLENGED TO AVOID LITIGATION AND BUY PEACE OF MIND AND THAT IN ANY CASE, THE ISSUE IS DEBATABLE. 5. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED ASSESSING OFFICER ERRED IN INITIATING PENALTY U/S 271(1)(C) ON ONE GROUND WHEREAS LEVYING PENALTY ON THE OTHER GROUND. 6. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE NOTICE ISSUED U/S 274 R.W.S. 271(1)(C) IS BAD IN LAW AND THEREFORE, ENTIRE PENALTY PROCEEDING MUST BE QUASHED . ALL THE ABOVE GROUNDS ARE INDEPENDENT AND WITHOUT PREJUDICE TO EACH OTHER. THE APPELLANT CRAVES LEAVE TO ADD, ALTER, RESCIND OR AMEND ANY OF THE GROUNDS. ' 3 . THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED HIS RETURN OF INCOME ON 31.07.2013 D ECLARING TOTAL INCOME TO THE TUNE OF RS.4,09,29,460/ - FOR THE A.Y. 2013 - 14. THE RETURN WAS PROCESSED U/S 143(3) OF THE ACT. THEREAFTER, THE CASE WAS SELECTED FOR SCRUTINY. NOTICES U/S 143(2) & 142(1) OF THE ACT WERE ISSUED AND SERVED UPON ITA. NO 5913 /M/201 8 A.Y. 20 13 - 14 3 THE ASSESSEE. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF FILM PRODUCER. THE ASSESSEE HAS SHOWN THE LOS S FROM BUSINESS & PROFESSION, INCOME FROM LONG TERM CAPITAL GAIN AND INCOME FROM OTHER SOURCES. THE ASSESSEE FILED THE REVISED COMPUTATION OF INCOME DECLARING HIGHER AMOUN T OF CAPITAL GAIN LONG TERM OF RS. 4,54,89,896/ - AS AGAINST THE RETURNED LONG TERM CAPITAL GAIN OF RS.3,46,84,186/ - . THE REVISION WAS ON ACCOUNT OF UNDERSTANDING OF NET SALE CONSIDERATION OF RS.14,24,30,000/ - TO CORRECT IT TO REVISED STATEMENT OF NET SALE C ONSIDERATION OF RS.14,49,21,166/ - . THEREFORE, DISCLOSED THE ADDITIONAL INCOME FROM LONG TERM CAPITAL GAIN OF RS.1,08,05,710/ - . THE ASSESSEE ALSO OFFERED THE INTEREST INCOME ON TAX REFUNDABLE OF RS.1,310/ - . THE TOTAL ADDITIONAL INCOME HAS BEEN OFFERED IN SU M OF RS.1,08,07,020/ - . THE ASSESSEE ALSO CLAIMED THE EXEMPTION U/S 54 OF THE I. T. ACT IN RESPECT OF TWO RESIDENTIAL HOUSE I.E. (I) FLAT AT MIRA ROAD OF RS.18,22,123/ - (II) FLAT AT JUHU OF RS.5,74,63,333/ - . THE NOTICE WAS ISSUED AS EXEMPTION WAS NOT ALLOWE D ON TWO FLATS AND AFTER THE REPLY OF THE ASSESSEE, THE EXEMPTION U/S 54 OF THE I. T. ACT IN SUM OF RS. 5,74,63,333/ - IN CONNECTION WITH THE JUHU FLAT WAS DECLINED. AFT ER SOME MORE DISALLOWANCE, THE TOTAL INCOME OF THE ASSESSEE WAS ASSESSED TO THE TUNE OF R S. 5,40,21,980/ - . THE PENALTY PROCEEDING WAS INITIATED BY ISSUANCE OF NOTICE DATED 29.01.2016 SPECIFICALLY UPON THE ADDITIONAL INCOME OFFERED IN SUM OF RS. 1,08,07,020/ - AND RS. 18,22,123/ - ON ACCOUNT OF EXEMPTION U/S 54 OF THE I. T. ACT IN RESPECT OF JUHU F LAT. THE TOTAL PENALTY IN SUM OF RS. 26,01,603/ - WAS LEVIED. ITA. NO 5913 /M/201 8 A.Y. 20 13 - 14 4 FEELING AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A) WHO CONFIRMED THE PENALTY, THEREFORE, THE ASSESSEE HAS FILED THE PRESENT APPEAL BEFORE US. 4 . WE HAVE HEARD THE ARGUMENT ADVANCED BY THE LD. REPRESENTATIVE OF THE PARTIES AND PERUSED THE RECO R D. AT THE VERY OUTSET, THE LD. REPRESENTATIVE OF THE ASSESSEE HAS ARGUED THAT THE PENALTY NOTICE NOWHERE SPEAKS ABOUT SPECIFIC LIMB TO LEVY THE PENALTY BECAUSE THE PARTICULAR CHARGE WAS NOT TIC K OFF IN THE NOTICE, THEREFORE, IN THE SAID CIRCUMSTANCES , THE PENALTY IS NOT JUSTIFIABLE HENCE THE ORDER OF THE CIT(A) CONFIRMING THE PENALTY ORDER OF THE AO IS WRONG AGAINST LAW AND FACTS AND IS LIABLE TO BE SET ASIDE. IN SUPPORT OF THESE CONTENTIONS THE LD. REPRESENTATIVE OF THE ASSESSEE HAS PLACED RELIANCE UPON THE LAW SETTLED IN ITA. NO.1154/M/2014 IN THE CASE OF CIT - 11 VS. SAMSON PERINCHERY AND THE ORDER OF THE ITAT, MUMBAI BENCH IN ITA. NO.2555/M/2012 VIDE ORDER DATED 28.04.2017 TITLED AS MEHERJEE CA SSINATH HOLDINGS P. LTD. VS. ACIT, CIRCLE - 4(2). HOWEVER, ON THE OTHER HAND, THE LD. REPRESENTATIVE OF THE DEPARTMENT HAS REFUTED THE SAID CONTENTI ONS. THE COPY OF NOTICE DATED 29 . 0 1 .201 6 IS ON THE FILE IN WHICH THE ASSESSING OFFICER NOWHERE SPECIFY ANY LI MB TO LEVY THE PENALTY BECAUSE NONE OF THE CHARGE WAS TICK OFF IN THE NOTICE. IT IS NOT IN DISPUTE THAT THE PENALTY U / S 271(C) OF THE ACT IS LEVIABLE ON ACCOUNT OF THE CONCEALMENT OF PARTICUL AR OF INCOME AND ON ACCOUNT OF FURNISHING THE INACCURATE PARTICUL ARS OF INCOME. BOTH HAVE ITA. NO 5913 /M/201 8 A.Y. 20 13 - 14 5 DIFFERENT CONNOTATIONS. IN THIS REGARD, THE HONBLE SUPREME COURT HAS APPRECIATED THE DISTINCTION BETWEEN BOTH THE LIMB IN THE CASE DILIP N. SHROFF 161 TAXMAN 218 (SC). AS PER THE RECORD, THE ASSESSMENT ORDER SPEAKS ABOUT LEVYING T HE PENALTY ON ACCOUNT OF FURNISHING THE INACCURATE PARTICULARS OF INCOME BUT THE NOTICE NOWHERE SPECIFY ANY LIMB TO LEVY THE PENALTY. THE NOTICE IS NOT JUSTIFIABLE IN VIEW OF THE LAW SETTLED BY THE BOMBAY HIGH COURT IN THE CASE OF CIT - 11 VS. SAMSON PERINCH ERY . AT THE TIME OF ARGUMENT, THE LD. REPRESENTATIVE OF THE ASSESSEE HAS ALSO PLACED RELIANCE UPON THE FINDING OF THE HONBLE ITAT IN ITA. NO. 2555/M/2012 TITLED AS MEHERJEE CASSINATH HOLDINGS P. LTD. VS. ACIT, CIRCLE - 4(2). THE RELEVANT PARA IS HEREBY REPR ODUCED BELOW: - 8. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS. SEC. 271(1)(C) OF THE ACT EMPOWERS THE ASSESSING OFFICER TO IMPOSE PENALTY TO THE EXTENT SPECIFIED IF, IN THE COURSE OF ANY PROCEEDINGS UNDER THE ACT, HE IS SATISFIED THAT ANY PERSON HAS CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME. IN OTHER WORDS, WHAT SEC. 271(1)(C) OF THE ACT POSTULATES IS THAT THE PENALTY CAN BE LEVIED ON THE EXISTENCE OF ANY OF THE TWO SITUATIONS, NAMELY, FOR CONCEALI NG THE PARTICULARS OF INCOME OR FOR FURNISHING INACCURATE PARTICULARS OF INCOME. THEREFORE, IT IS OBVIOUS FROM THE PHRASEOLOGY OF SEC. 271(1)(C) OF THE ACT THAT THE IMPOSITION OF PENALTY IS INVITED ONLY WHEN THE CONDITIONS PRESCRIBED U/S 271(1)(C) OF THE ACT EXIST. IT IS ALSO A WELL ACCEPTED PROPOSITION THAT CONCEALMENT OF THE PARTICULARS OF INCOME AND FURNISHING OF INACCURATE PARTICULARS OF INCOME REFERRED TO IN SEC. 271(1)(C) OF THE ACT DENOTE DIFFERENT CONNOTATIONS. IN FACT, THIS DISTINCTION HAS B EEN APPRECIATED EVEN AT THE LEVEL OF HON'BLE SUPREME COURT NOT ONLY IN THE CASE OF DILIP N. SHROFF (SUPRA) BUT ALSO IN THE CASE OF T. ASHOK PAI, 292 ITR 11 (SC). THEREFORE, IF THE TWO EXPRESSIONS, NAMELY CONCEALMENT OF THE PARTICULARS OF INCOME AND FUR NISHING OF INACCURATE ITA. NO 5913 /M/201 8 A.Y. 20 13 - 14 6 PARTICULARS OF INCOME HAVE DIFFERENT CONNOTATIONS, IT IS IMPERATIVE FOR THE ASSESSEE TO BE MADE AWARE AS TO WHICH OF THE TWO IS BEING PUT AGAINST HIM FOR THE PURPOSE OF LEVY OF PENALTY U/S 271(1)(C) OF THE ACT, SO THAT THE ASSESSEE C AN DEFEND ACCORDINGLY. IT IS IN THIS BACKGROUND THAT ONE HAS TO APPRECIATE THE PRELIMINARY PLEA OF ASSESSEE, WHICH IS BASED ON THE MANNER IN WHICH THE NOTICE U/S 274 R.W.S. 271(1)(C) OF THE ACT DATED 10.12.2010 HAS BEEN ISSUED TO THE ASSESSEE - COMPANY. A COPY OF THE SAID NOTICE HAS BEEN PLACED ON RECORD AND THE LEARNED REPRESENTATIVE CANVASSED THAT THE SAME HAS BEEN ISSUED BY THE ASSESSING OFFICER IN A STANDARD PROFORMA, WITHOUT STRIKING OUT THE IRRELEVANT CLAUSE. IN OTHER WORDS, THE NOTICE REFERS TO BOTH THE LIMBS OF SEC. 271(1)(C) OF THE ACT, NAMELY CONCEALMENT OF THE PARTICULARS OF INCOME AS WELL AS FURNISHING OF INACCURATE PARTICULARS OF INCOME. QUITE CLEARLY, NON - STRIKING - OFF OF THE IRRELEVANT LIMB IN THE SAID NOTICE DOES NOT CONVEY TO THE ASSESSEE A S TO WHICH OF THE TWO CHARGES IT HAS TO RESPOND. THE AFORESAID INFIRMITY IN THE NOTICE HAS BEEN SOUGHT TO BE DEMONSTRATED AS A REFLECTION OF NON - APPLICATION OF MIND BY THE ASSESSING OFFICER, AND IN SUPPORT, REFERENCE HAS BEEN MADE TO THE FOLLOWING SPECIFI C DISCUSSION IN THE ORDER OF HON'BLE SUPREME COURT IN THE CASE OF DILIP N. SHROFF (SUPRA): - 83. IT IS OF SOME SIGNIFICANCE THAT IN THE STANDARD PROFORMA USED BY THE ASSESSING OFFICER IN ISSUING A NOTICE DESPITE THE FACT THAT THE SAME POSTULATES THAT INAP PROPRIATE WORDS AND PARAGRAPHS WERE TO BE DELETED, BUT THE SAME HAD NOT BEEN DONE. THUS, THE ASSESSING OFFICER HIMSELF WAS NOT SURE AS TO WHETHER HE HAD PROCEEDED ON THE BASIS THAT THE ASSESSEE HAD CONCEALED HIS INCOME OR HE HAD FURNISHED INACCURATE PARTI CULARS. EVEN BEFORE US, THE LEARNED ADDITIONAL SOLICITOR GENERAL WHILE PLACING THE ORDER OF ASSESSMENT LAID EMPHASIS THAT HE HAD DEALT WITH BOTH THE SITUATIONS. 84. THE IMPUGNED ORDER, THEREFORE, SUFFERS FROM NON - APPLICATION OF MIND. IT WAS ALSO BOUND T O COMPLY WITH THE PRINCIPLES OF NATURAL JUSTICE. (SEE MALABAR INDUSTRIAL CO. LTD. V. CIT [2000] 2 SCC 718] 9. FACTUALLY SPEAKING, THE AFORESAID PLEA OF ASSESSEE IS BORNE OUT OF RECORD AND HAVING REGARD TO THE PARITY OF REASONING LAID DOWN BY THE HON'BLE SUPREME COURT IN THE CASE OF DILIP N. SHROFF ITA. NO 5913 /M/201 8 A.Y. 20 13 - 14 7 (SUPRA), THE NOTICE IN THE INSTANT CASE DOES SUFFER FROM THE VICE OF NON - APPLICATION OF MIND BY THE ASSESSING OFFICER. IN FACT, A SIMILAR PROPOSITION WAS ALSO ENUNCIATED BY THE HON'BLE KARNATAKA HIGH COURT IN T HE CASE OF M/S. SSAS EMERALD MEADOWS (SUPRA) AND AGAINST SUCH A JUDGMENT, THE SPECIAL LEAVE PETITION FILED BY THE REVENUE HAS SINCE BEEN DISMISSED BY THE HON'BLE SUPREME COURT VIDE ORDER DATED 5.8.2016, A COPY OF WHICH IS ALSO PLACED ON RECORD. 10. IN FA CT, AT THE TIME OF HEARING, THE LD. CIT - DR HAS NOT DISPUTED THE FACTUAL MATRIX, BUT SOUGHT TO POINT OUT THAT THERE IS DUE APPLICATION OF MIND BY THE ASSESSING OFFICER WHICH CAN BE DEMONSTRATED FROM THE DISCUSSION IN THE ASSESSMENT ORDER, WHEREIN AFTER DISC USSING THE REASONS FOR THE DISALLOWANCE, HE HAS RECORDED A SATISFACTION THAT PENALTY PROCEEDINGS ARE INITIATED U/S 271(1)(C) OF THE ACT FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. IN OUR CONSIDERED OPINION, THE ATTEMPT OF THE LD. CIT - DR TO DEMONST RATE APPLICATION OF MIND BY THE ASSESSING OFFICER IS NO DEFENCE INASMUCH AS THE HON'BLE SUPREME COURT HAS APPROVED THE FACTUM OF NON - STRIKING OFF OF THE IRRELEVANT CLAUSE IN THE NOTICE AS REFLECTIVE OF NON - APPLICATION OF MIND BY THE ASSESSING OFFICER. SIN CE THE FACTUAL MATRIX IN THE PRESENT CASE CONFORMS TO THE PROPOSITION LAID DOWN BY THE HON'BLE SUPREME COURT, WE PROCEED TO REJECT THE ARGUMENTS ADVANCED BY THE LD. CIT - DR BASED ON THE OBSERVATIONS OF THE ASSESSING OFFICER IN THE ASSESSMENT ORDER. FURTHER , IT IS ALSO NOTICEABLE THAT SUCH PROPOSITION HAS BEEN CONSIDERED BY THE HON'BLE BOMBAY HIGH COURT ALSO IN THE CASE OF SHRI SAMSON PERINCHERY, ITA NOS. 1154, 953, 1097 & 1126 OF 2014 DATED 5.1.2017 (SUPRA) AND THE DECISION OF THE TRIBUNAL HOLDING LEVY OF P ENALTY IN SUCH CIRCUMSTANCES BEING BAD, HAS BEEN APPROVED. 11. APART FROM THE AFORESAID, THE LD. CIT - DR MADE AN ARGUMENT BASED ON THE DECISION OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF SMT. KAUSHALYA & OTHERS, 216 ITR 660 (BOM.) TO CANVASS SUPPORT F OR HIS PLEA THAT NON - STRIKING OFF OF THE IRRELEVANT PORTION OF NOTICE WOULD NOT INVALIDATE THE IMPOSITION OF PENALTY U/S 271(1)(C) OF THE ACT. WE HAVE CAREFULLY CONSIDERED THE SAID ARGUMENT SET - UP BY THE LD. CIT - DR AND FIND THAT A SIMILAR ISSUE HAD COME U P BEFORE OUR COORDINATE BENCH IN THE CASE OF DR. SARITA MILIND DAVARE (SUPRA). OUR COORDINATE BENCH, AFTER CONSIDERING ITA. NO 5913 /M/201 8 A.Y. 20 13 - 14 8 THE JUDGMENT OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF SMT. KAUSHALYA & ORS., (SUPRA) AS ALSO THE JUDGMENTS OF THE HON'BLE SUPREME COURT IN THE CASE OF DILIP N. SHROFF (SUPRA) AND DHARMENDRA TEXTILE PROCESSORS, 306 ITR 277 (SC) DEDUCED AS UNDER : - 12. A COMBINED READING OF THE DECISION RENDERED BY HONBLE BOMBAY HIGH COURT IN THE CASE OF SMT. B KAUSHALYA AND OTHERS (SUPRA) AND THE DECISION RENDERED BY HONBLE SUPREME COURT IN THE CASE OF DILIP N SHROFF (SUPRA) WOULD MAKE IT CLEAR THAT THERE SHOULD BE APPLICATION OF MIND ON THE PART OF THE AO AT THE TIME OF ISSUING NOTICE. IN THE CASE OF LAKHDIR LALJI (SUPRA), THE AO ISSUED NOTICE U/ S 274 FOR CONCEALMENT OF PARTICULARS OF INCOME BUT LEVIED PENALTY FOR FURNISHING INACCURATE PARTICULARS OF INCOME. THE HONBLE GUJARAT HIGH COURT QUASHED THE PENALTY SINCE THE BASIS FOR THE PENALTY PROCEEDINGS DISAPPEARED WHEN IT WAS HELD THAT THERE WAS NO SUPPRESSION OF INCOME. THE HONBLE KERALA HIGH COURT HAS STRUCK DOWN THE PENALTY IMPOSED IN THE CASE OF N.N.SUBRAMANIA IYER VS. UNION OF INDIA (SUPRA), WHEN THERE IS NO INDICATION IN THE NOTICE FOR WHAT CONTRAVENTION THE PETITIONER WAS CALLED UPON TO SHOW CAUSE WHY A PENALTY SHOULD NOT BE IMPOSED. IN THE INSTANT CASE, THE AO DID NOT SPECIFY THE CHARGE FOR WHICH PENALTY PROCEEDINGS WERE INITIATED AND FURTHER HE HAS ISSUED A NOTICE MEANT FOR CALLING THE ASSESSEE TO FURNISH THE RETURN OF INCOME. HENCE, IN THE INSTANT CASE, THE ASSESSING OFFICER DID NOT SPECIFY THE CHARGE FOR WHICH THE PENALTY PROCEEDINGS WERE INITIATED AND ALSO ISSUED AN INCORRECT NOTICE. BOTH THE ACTS OF THE AO, IN OUR VIEW, CLEARLY SHOW THAT THE AO DID NOT APPLY HIS MIND WHEN HE ISSUED NOTIC E TO THE ASSESSEE AND HE WAS NOT SURE AS TO WHAT PURPOSE THE NOTICE WAS ISSUED. THE HONBLE BOMBAY HIGH COURT HAS DISCUSSED ABOUT NON - APPLICATION OF MIND IN THE CASE OF KAUSHALYA (SUPRA) AND OBSERVED AS UNDER: - ... THE NOTICE CLEARLY DEMONSTRATED NON - A PPLICATION OF MIND ON THE PART OF THE INSPECTING ASSISTANT COMMISSIONER. THE VAGUENESS AND AMBIGUITY IN THE NOTICE HAD ALSO PREJUDICED THE RIGHT OF REASONABLE OPPORTUNITY OF THE ASSESSEE SINCE HE DID NOT KNOW WHAT EXACT CHARGE HE HAD TO FACE. IN THIS BACK GROUND, QUASHING OF THE PENALTY PROCEEDINGS FOR THE ASSESSMENT YEAR 1967 - 68 SEEMS TO BE FULLY JUSTIFIED. ITA. NO 5913 /M/201 8 A.Y. 20 13 - 14 9 IN THE INSTANT CASE ALSO, WE ARE OF THE VIEW THAT THE AO HAS ISSUED A NOTICE, THAT TOO INCORRECT ONE, IN A ROUTINE MANNER. FURTHER THE NOTICE DID N OT SPECIFY THE CHARGE FOR WHICH THE PENALTY NOTICE WAS ISSUED. HENCE, IN OUR VIEW, THE AO HAS FAILED TO APPLY HIS MIND AT THE TIME OF ISSUING PENALTY NOTICE TO THE ASSESSEE. 12. THE AFORESAID DISCUSSION CLEARLY BRINGS OUT AS TO THE REASONS WHY THE PARIT Y OF REASONING LAID DOWN BY THE HON'BLE SUPREME COURT IN THE CASE OF DILIP N. SHROFF (SUPRA) IS TO PREVAIL. FOLLOWING THE DECISION OF OUR COORDINATE BENCH IN THE CASE OF DR. SARITA MILIND DAVARE (SUPRA), WE HEREBY REJECT THE AFORESAID ARGUMENT OF THE LD. CIT - DR. 13. APART FROM THE AFORESAID DISCUSSION, WE MAY ALSO REFER TO THE ONE MORE SEMINAL FEATURE OF THIS CASE WHICH WOULD DEMONSTRATE THE IMPORTANCE OF NON - STRIKING OFF OF IRRELEVANT CLAUSE IN THE NOTICE BY THE ASSESSING OFFICER. AS NOTED EARLIER, IN T HE ASSESSMENT ORDER DATED 10.12.2010 THE ASSESSING OFFICER RECORDS THAT THE PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT ARE TO BE INITIATED FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. HOWEVER, IN THE NOTICE ISSUED U/S 274 R.W.S. 271(1)(C) OF THE ACT OF EVEN DATE, BOTH THE LIMBS OF SEC. 271(1)(C) OF THE ACT ARE REPRODUCED IN THE PROFORMA NOTICE AND THE IRRELEVANT CLAUSE HAS NOT BEEN STRUCK - OFF. QUITE CLEARLY, THE OBSERVATION OF THE ASSESSING OFFICER IN THE ASSESSMENT ORDER AND NON - STRIKING OFF OF THE IRRELEVANT CLAUSE IN THE NOTICE CLEARLY BRINGS OUT THE DIFFIDENCE ON THE PART OF ASSESSING OFFICER AND THERE IS NO CLEAR AND CRYSTALLISED CHARGE BEING CONVEYED TO THE ASSESSEE U/S 271(1)(C), WHICH HAS TO BE MET BY HIM. AS NOTED BY THE HON'BLE SUPREME COURT IN THE CASE OF DILIP N. SHROFF (SUPRA), THE QUASI - CRIMINAL PROCEEDINGS U/S 271(1)(C) OF THE ACT OUGHT TO COMPLY WITH THE PRINCIPLES OF NATURAL JUSTICE, AND IN THE PRESENT CASE, CONSIDERING THE OBSERVATIONS OF THE ASSESSING OFFICER IN THE ASSESSMENT O RDER ALONGSIDE HIS ACTION OF NON - STRIKING OFF OF THE IRRELEVANT CLAUSE IN THE NOTICE SHOWS THAT THE CHARGE BEING MADE AGAINST THE ASSESSEE QUA SEC. 271(1)(C) OF THE ACT IS NOT FIRM AND, THEREFORE, THE PROCEEDINGS SUFFER FROM NON - COMPLIANCE WITH PRINCIPLES OF NATURAL JUSTICE INASMUCH AS THE ASSESSING OFFICER IS HIMSELF UNSURE AND ASSESSEE IS NOT MADE AWARE AS TO WHICH OF THE TWO LIMBS OF SEC. 271(1)(C) OF THE ACT HE HAS TO RESPOND. ITA. NO 5913 /M/201 8 A.Y. 20 13 - 14 10 14. THEREFORE, IN VIEW OF THE AFORESAID DISCUSSION, IN OUR VIEW, THE NOTICE ISSUED BY THE ASSESSING OFFICER U/S 274 R.W.S. 271(1)(C) OF THE ACT DATED 10.12.2010 IS UNTENABLE AS IT SUFFERS FROM THE VICE OF NON - APPLICATION OF MIND HAVING REGARD TO THE RATIO OF THE JUDGMENT OF THE HON'BLE SUPREME COURT IN THE CASE OF DILIP N. SHROFF (SUPRA) AS WELL AS THE JUDGMENT OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF SHRI SAMSON PERINCHERY (SUPRA). THUS, ON THIS COUNT ITSELF THE PENALTY IMPOSED U/S 271(1)(C) OF THE ACT IS LIABLE TO BE DELETED. WE HOLD SO. SINCE THE PENALTY HAS BEEN DELETE D ON THE PRELIMINARY POINT, THE OTHER ARGUMENTS RAISED BY THE APPELLANT ARE NOT BEING DEALT WITH. 5 . NOW COMING TO THE MERITS OF THE CASE, THE PENALTY HAS BEEN LEVIED BY AO ON THE BASIS OF THIS FACT THAT THE ASSESSEE HAS FILED THE REVISED RETURN OF INCOM E BY SHOWING THE ADDITIONAL INCOME AND ON ACCOUNT OF DISALLOWANCE OF CLAIM U/S 54 OF THE I. T. ACT IN CONNECTION WITH THE JUHU FLATS. IN THE REVISED RETURN OF INCOME, THERE IS NO CONCEALMENT OF INCOME AND FURNISHING INACCURATE PARTICULARS OF INCOME OF ANY KIND. DISALLOWANCE OF CLAIM U/S 54 OF THE I. T. ACT, NO WHERE ATTRACT THE PENALTY IN VIEW OF THE DECISION OF HONBLE APEX COURT IN THE CASE OF RELIANCE PETROPRODUCT VS. CIT (P) LTD. 322 ITR 158 SC. TAKING INTO ACCOUNT ALL THE FACTS AND CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE FINDING OF THE CIT(A) IS NOT JUSTIFIABLE, THEREFORE, WE SET ASIDE THE SAME AND DELETE THE PENALTY . ITA. NO 5913 /M/201 8 A.Y. 20 13 - 14 11 6 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS HEREBY ORDERED TO BE ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 29/01 / 202 0 SD/ - SD/ - / - ( RAJESH KUMAR ) (AMARJIT SINGH) / ACCOUNTANT MEMBER /JUDICIAL MEMBER MUMBAI; DATED : 29/01 / 20 20 V IJAY PAL SINGH/SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESP ONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. / BY ORDER, //TRUE COPY// / /(DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI