Vatika one on one Private Limited, New Delhi V. ACIT Circle-26(1), New Delhi

ITA 6023/DEL/2019

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 1107 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-10-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 10-10-2022
• Assessment Year: 2015-2016
• Appeal Filed On: 11-07-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 271(1)(c); 274; 73

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL DELHIBENCH ‘H’, NEW DELHI Before Dr. B. R. R. Kumar, Accountant Member Sh. Yogesh Kumar US, Judicial Member ITA No. 6023/Del/2019 : Asstt. Year : 2015-16 Vatika One on One Pvt. Ltd., Flat No. 224A, 2 nd Floor, Devika Tower, 6, Nehru Place, New Delhi-110019 Vs ACIT, Circle-26(1), New Delhi-110002 (APPELLANT) (RESPONDENT) PAN No. AAECC2937P Assessee by : Sh. C. S. Aggarwal, Sr. Adv. Revenue by : Sh. Vivek Vardhan, Sr. DR Date of Hearing: 11.10.2022 Date of Pronouncement: 12.10.2022 ORDER Per Dr. B. R. R. Kumar, Accountant Member: The present appeal has been filed by the assessee against the order of ld. CIT(A)-9, New Delhi dated 15.05.2019. 2. The Assessing Officer made addition of Rs.31,98,720/- to the total income on account of 4/5 th disallowance of capital expenditure. Consequent to the disallowance, penalty u/s 271(1)(c) has been initiated by the AO by issuing notice u/s 271 r.w.s. 274 of the Income Tax Act, 1961 dated 28.11.2017 followed by notice on 07.05.2018 fixing the case for hearing on 27.12.2017 and 15.05.2018 respectively. The penalty order has been passed on 25.05.2018. At para 6.2 the AO mentioned that “income in respect of which particulars have been concealed or inaccurate particulars have been furnished: Rs.31,98,720/-.” 2 3. We have gone through the notice u/s 274 r.w.s. 271 of the Income Tax Act, 1961 issued by the Assessing Officer on 07.05.2018. We find that the Assessing Officer has issued the penalty order stating that, you *have concealed the particulars of your income or furnished inaccurate particulars of such income in terms of explanation 1, 2, 3, 4 and 5.” Further, we have examined the notice issued dated 28.11.2017 stating that, you *have concealed the particulars of your income or furnished inaccurate particulars of such income in terms of explanation 1, 2, 3, 4 and 5.” 4. On this issue, we are guided by the following judgments: 1) Karnataka High Court: CIT vs. Manjunatha Cotton and Ginning Factory: 359 ITR 565 held that notice under section 274 should specifically state the grounds mentioned in section 271(1)(c) of the Act, i.e., whether it is for concealment of income or for furnishing of incorrect particulars of income. Sending printed form where all the grounds mentioned in section 271 are mentioned would not satisfy requirement of law. 2) Bombay High Court: Mr. Mohd. Farhan A. Shaikh Vs ACIT Section 271(1)(c): Penalty-Concealment-Non-striking off of the irrelevant part while issuing notice u/s 271(1)(c) of the Income Tax Act, order is bad in law. Assessee must be informed of the ground of the penalty proceedings only through statutory notice. An omnibus notice suffers from the vice of vagueness. 3) The Hon’ble jurisdictional Delhi High Court in the case of PCIT vs. Sahara India Life Insurance Co. Ltd. in ITA No. 475 of 2019, reiterated that notice under section 274 should specifically state the grounds on which penalty was 3 sought to be imposed as the assessee should know the grounds which he has to meet specifically. 4) The aforesaid principle has been reiterated in the in the case of CIT vs. SSA'S Emerald Meadows: 73 taxmann.com 241 (Kar) [Revenue’s SLP dismissed in 242 Taxman 180] 5. Hence, respectfully following the order of the Hon’ble Jurisdictional High Court, since the AO has not been specified u/s 274 as to whether penalty is proposed for alleged ‘concealment of income’ OR ‘furnishing of inaccurate particulars of such income’, the penalty levied is hereby obliterated. 6. In the result, the appeals of the assessee are allowed. Order Pronounced in the Open Court on 12/10/2022. Sd/- Sd/- (Yogesh Kumar US) (Dr. B. R. R. Kumar) Judicial Member Accountant Member Dated: 12/10/2022 *Subodh Kumar, Sr. PS* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR