SRI. BASAVANA MATHIKERE BETASWAMY GOWDA RAMASWAMY GOWDA ,BANGALORE V. INCOME TAX OFFICER, WARD-2(2)(2), BANGALORE

ITA 1313/BANG/2024

AI Insights

The case involves an appeal by Sri Basavana Mathikere Betaswamy Gowda Ramaswamy Gowda against a penalty imposed by the Income Tax Officer, Ward \\u2013 2(2)(2), Bengaluru, for the assessment year 2009-10. The penalty was confirmed by the CIT(A) but was contested on the grounds that the penalty notice did not specify the exact nature of the violation, whether it was for concealment of income or furnishing inaccurate particulars. The Tribunal found that the absence of a specific charge in the penalty notice rendered the penalty unsustainable, leading to the decision to set aside the penalty.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 474078 (ITAT-BANGALORE)
• Duration Of Justice: 4 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-11-2024
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 16-10-2024
• Assessment Year: 2009-2010
• Appeal Filed On: 11-07-2024
• Other Referred Cases: Pr. CIT VS. Golden Peas Holiday and Resorts Pvt. Ltd.
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: V PARITHIVEL
• Assessee Lawyers: SUNAINA BHATIA
• Keywords: Set aside; Initiation of penalty proceedings
• Section: 271(1)(c); 13; 274

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL ‘C’ BENCH, BANGALORE BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI KESHAV DUBEY, JUDICIAL MEMBER ITA No.1313/Bang/2024 Assessment Year: 2009-10 Sri Basavana Mathikere Betaswamy Gowda Ramaswamy Gowda, 780, Lakshmi Nivasa, 5th Main, II Stage, West of Chord Road, Rajajinagar, Bangalore – 560 010. PAN – ADFPR 4248 H Vs. The Income Tax Officer, Ward – 2(2)(2), Bengaluru. . APPELLANT RESPONDENT Assessee by : Ms. Sunaina Bhatia, Advocate Revenue by : Shri V Parithivel, JCIT (DR) Date of hearing : 16.10.2024 Date of Pronouncement : 25.11.2024 O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER: This is an appeal filed by the assessee against the order passed by the NFAC, Delhi dated 17/05/2024 in DIN No. ITBA/NFAC/ S/250/2024-25/1064954394(1) for the assessment year 2009-10. 2. The only issue raised by the assessee is that the ld. CIT(A) erred in confirming the penalty levied by the AO for Rs. 11,37,138/- under the provisions of sec. 271(1)(c) of the Act. ITA No.1313/Bang/2024 Page 2 of 4 . 3. At the outset, the ld. AR on behalf of the assessee submitted that the initiation of the penalty proceedings u/s 271(1)(C) of the Act is bad in law and, therefore, the penalty order is not sustainable. As per the ld. AR, the AO has neither stated specific charge in the notice issued u/s 274 of the Act nor in the assessment order dated 30/12/2011, whether the penalty was levied for concealment of income or on account of furnishing of inaccurate particulars of income. Accordingly, the ld. AR contended that the penalty levied by the AO u/s 271(1)(c) of the Act is not sustainable. 4. On the other hand, the learned DR before us vehemently supported the order of the authorities below. 5. We have heard the rival contentions of both the parities and perused the materials available on record. The penalty u/s 271(1)(c) of the Act can be levied either on account of concealment of income or furnishing of inaccurate particulars of income. As such in the absence of any specific charge for initiation of penalty u/s 271(1)(c) of the Act, the penalty levied u/s 271(1)(c) of the Act is not sustainable. The Hon’ble High Court of Bombay in the case of Pr. CIT VS. Golden Peas Holiday and Resorts Pvt. Ltd., reported in 124 Taxmann.com 248 has held as under: 5. We have carefully examined the record as well as duly considered the rival contentions. Both the Commissioner (Appeals) as well as the ITAT have categorically held that in the present case, there is no record of satisfaction by the Assessing Officer that there was any concealment of income or that any inaccurate particulars were furnished by the assessee. This being a sine qua non for initiation of penalty proceedings, in the absence of such satisfaction, the two authorities have quite correctly ordered the dropping of penalty proceedings against the assessee. ITA No.1313/Bang/2024 Page 3 of 4 . 6. The view taken by the Hon’ble Bombay High Court in the case cited above was subsequently upheld by the Hon’ble Apex Court of India reported in 124 Taxmann.com 249. 7. Coming to the facts of the case, we have perused the assessment order and the notice issued u/s 274 of the Act placed on page 13 of the paper book, we note that the AO has not specified the charge for initiation of the penalty whether it was for concealment of income or furnishing inaccurate particulars of income. Accordingly, we are of the view that in the absence of specific charge by the AO, the penalty levied u/s 271(1)(C) of the Act is not sustainable. Accordingly, we set aside the finding of the ld. CIT(A) and direct the AO to delete the penalty levied by him u/s 271(1)(c) of the Act. 8. As we have decided the issue in favour of the assessee on the technical ground raised by the assessee, accordingly, we do not find any reason to adjudicate the grounds of appeal of the assessee raised on merit. As such, the grounds raised by the assessee on merit become infructuous. Accordingly, we dismiss the same as infructuous. 9. In the result, the appeal of the assessee is hereby partly allowed. Order pronounced in court on 25th day of November, 2024 Sd/- Sd/- (KESHAV DUBEY) (WASEEM AHMED) Judicial Member Accountant Member Bangalore Dated, 25th November, 2024 / vms / ITA No.1313/Bang/2024 Page 4 of 4 . Copy to: 1. The Applicant 2. The Respondent 3. The CIT 4. The CIT(A) 5. The DR, ITAT, Bangalore. 6. Guard file By order Asst. Registrar, ITAT, Bangalore "