Referred Sections:
Section 271(1)(c) of the I.T. Act, 1961.
Referred Cases / Judgments:
Mr. Vijay Aggarwal, Meerut vs. DCIT, Central Circle-1, Faridabad, Dated 09.08.2019
Faridabad vs., DCIT, Circle-1, Faridabad, Dated 04.10.2019 in ITA.No.4747/Del/2016,
Pr. CIT vs. M/s. Sahara India Life Insurance Company Ltd., 2019 (8) TMI 409 (Del.)
Sundaram Finance Ltd., vs. CIT [2018] 93 taxmann.com 250 (Mad.)
CIT vs. M/s. SSAs Emerald Meadows 73 taxmann.com 241 (Kar.)
CIT vs. M/s. Sahara India Life Insurance Company Ltd.,
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCHES "C": DELHI
BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER
AND
SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER
ITA.No.2644/Del./2017
Assessment Year 2007-2008
Smt. Harmeet Kaur Sran, The DCIT,
527B, 5th Floor, HBN
Office, D-Mall, Dist. vs., Central Circle 29,
Centre, Paschim Vihar,
New Delhi 110 087. New Delhi.
PAN BMJPS0698L
(Appellant) (Respondent)
For Assessee : Shri Varun Jain, C.A.
For Revenue : Ms. Rakhi Vimal, Sr. D.R.
Date of Hearing : 09.10.2019
Date of Pronouncement : 11.10.2019
ORDER
PER BHAVNESH SAINI, J.M.
This appeal by Assessee has been directed against
the Order of the Ld. CIT(A)-30, New Delhi, Dated 30.01.2017
for the A.Y. 2007-2008, challenging the levy of penalty
under section 271(1)(c) of the I.T. Act, 1961.
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ITA.No.2644/Del./2017 Smt. Harmeet
Kaur Sran, New Delhi.
2. We have heard the Learned Representatives of
both the parties and perused the material on record.
3. Learned Counsel for the Assessee submitted that
A.O. has issued show cause notice before levy of the penalty
Dated 23.12.2011 in which A.O. has mentioned as under :
"Have concealed the particulars of your income or
furnished inaccurate particulars of such income."
3.1. He has submitted that A.O. in the assessment
order has initiated the penalty proceedings under section
271(1)(c) of the I.T. Act for concealing the particulars of
income, however, in the penalty Order, A.O. has held that
assessee is in default for concealing his income by
furnishing inaccurate particulars of his income. He has,
therefore, submitted that it is not discernible as to whether
penalty proceedings are initiated for furnishing inaccurate
particulars of income or for concealment of income and,
therefore, penalty is liable to be quashed.
4. The Ld. D.R. on the other hand, relied upon the
Orders of the authorities below and submitted that this
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ITA.No.2644/Del./2017 Smt. Harmeet
Kaur Sran, New Delhi.
point have not been raised by assessee and essentially it is
an issue of fact, therefore, this ground cannot be considered
in favour of the assessee and relied upon Order of ITAT,
Delhi G-Bench in the case of Mr. Vijay Aggarwal, Meerut vs.,
DCIT, Central Circle-1, Faridabad, Dated 09.08.2019 in
ITA.Nos.5434 & 5435/Del./2016 for the A.Ys. 2008-2009
and 2009-2010.
5. We have considered the rival submissions. The
ITAT, Delhi C-Bench in the case of Hemla Embroidery Mills
Private Ltd., Faridabad vs., DCIT, Circle-1, Faridabad,
Dated 04.10.2019 in ITA.No.4747/Del/2016, for the A.Y.
2012-2013, have decided the identical issue and the
findings of the Tribunal are as under :
"IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCHES "C": DELHI
BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER
AND
SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER
ITA.No.4747/Del./2016
Assessment Year 2009-2010
4
ITA.No.2644/Del./2017 Smt. Harmeet
Kaur Sran, New Delhi.
Hemla Embroidery Mills The DCIT,
Private Ltd., 14/6, Mathura vs.,
Circle-1,
Road, Faridabad.
PAN AAACH4302B Faridabad.
(Appellant) (Respondent)
For Assessee : Shri M.P. Rastogi, Advocate.
For Revenue : Shri S.S. Rana, CIT-D.R.
Date of Hearing : 03.10.2019
Date of Pronouncement : 04.10.2019
ORDER
PER BHAVNESH SAINI, J.M.
This appeal by Assessee has been directed against
the Order of the Ld. CIT(A), Faridabad, Dated
01.07.2016 for the A.Y. 2009-2010, challenging the levy
of penalty under section 271(1)(c) of the I.T. Act, 1961.
2. We have heard the Learned Representatives
of both the parties.
3. The assessee has challenged the levy of
penalty in this case as well as raised additional ground
of appeal stating therein that notice issued before levy
of the penalty is bad in law and is vague and did not
provide as to under which limb of Section 271(1)(c) of
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ITA.No.2644/Del./2017 Smt. Harmeet
Kaur Sran, New Delhi.
the I.T. Act, penalty proceedings have been initiated.
Therefore, the entire penalty order is illegal and void in
law. Since it is a legal issue, therefore, same is admitted
for disposal of the appeal.
4. Learned Counsel for the Assessee referred to
show cause notice Dated 30.12.2011 issued before levy
of the penalty in which the A.O. has mentioned as
under:
"Have concealed the particulars of your income or
furnished inaccurate particulars of such income."
4.1. He has, also referred to show cause notice
Dated 13.02.2015 before levy of the penalty in which
A.O. has mentioned as under :
"In this regard it may be noted that hearing with
respect to imposition of penalty u/s 271(l)(c) in your
case for the assessment year 2009-10 is fixed for
23.02.2015 at 11:30 A.M. It is requested that you may
either attend or submit a written reply to this office by
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ITA.No.2644/Del./2017 Smt. Harmeet
Kaur Sran, New Delhi.
the said date, failing which it shall be presumed that
you have nothing to say in this matter and your case
shall be decided on merits. If you have already filed
any reply, please file a copy of the same."
4.2. He has, therefore, submitted that penalty is
illegal and bad in law and submitted that the issue is
covered by the Judgment of the Hon'ble Delhi High court
in the case of Pr. CIT vs. M/s. Sahara India Life
Insurance Company Ltd., 2019 (8) TMI 409 (Del.) vide
Judgment Dated 02.08.2019 in paras 21 and 22 held
as under :
"21. The Respondent had challenged the upholding
of the penalty imposed under Section 271(1) (c) of the
Act, which was accepted by the ITAT. It followed the
decision of the Karnataka High Court in CIT v.
Manjunatha Cotton & Ginning Factory 359 ITR 565
(Kar) and observed that the notice issued by the AO
would be bad in law if it did not specify which limb of
Section 271(1) (c) the penalty proceedings had been
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ITA.No.2644/Del./2017 Smt. Harmeet
Kaur Sran, New Delhi.
initiated under i.e. whether for concealment of
particulars of income or for furnishing of inaccurate
particulars of income. The Karnataka High Court had
followed the above judgment in the subsequent order
in Commissioner of Income Tax v. SSA's Emerald
Meadows (2016) 73 Taxman.com 241 (Kar), the appeal
against which was dismissed by the Supreme Court of
India in SLP No.11485 of 2016 by order dated 5th
August, 2016.
22. On this issue again this Court is unable to find
any error having been committed by the ITAT. No
substantial question of law arises."
5. The Ld. D.R. on the other hand, relied upon
the Orders of the authorities below and relied upon
Judgment of Hon'ble Madras High Court in the case of
Sundaram Finance Ltd., vs. CIT [2018] 93 taxmann.com
250 (Mad.) and Judgment of Hon'ble Supreme Court in
the case of Sundaram Finance Ltd., vs. CIT [2018] 99
taxmann.com 152 (SC).
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ITA.No.2644/Del./2017 Smt. Harmeet
Kaur Sran, New Delhi.
6. We have considered the rival submissions. In
this case, the A.O. issued show cause notice for levy of
penalty in which A.O. has mentioned both the limbs of
section 271(1)(c) of the Act that assessee has concealed
the particulars of income or furnished inaccurate
particulars of such income. The issue of the notice is
bad in law as it did not specify under which limb of
Section 271(1)(c) of the I.T. Act, penalty proceedings
have been initiated whether for concealment of
particulars of income or furnishing of inaccurate
particulars of income. The issue is, therefore, covered by
Judgment of Hon'ble Karnataka High Court in the case
of CIT vs. M/s. SSAs Emerald Meadows 73
taxmann.com 241 (Kar.) and confirmed by the Hon'ble
Supreme Court reported in 73 taxmann.com 248 (SC).
Further, the Hon'ble Delhi High court in the case of Pr.
CIT vs. M/s. Sahara India Life Insurance Company Ltd.,
(supra) decided the same issue in favour of the
assessee. Following the same, we are of the view that
since notice is bad in law, therefore, the entire penalty
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ITA.No.2644/Del./2017 Smt. Harmeet
Kaur Sran, New Delhi.
proceedings are vitiated and as such no penalty is
leviable against the assessee. We, accordingly, set
aside the Orders of the authorities below and cancel the
penalty.
7. In the result, appeal of assessee allowed."
5.1. Following the same, we set aside the Orders of
the authorities below and cancel the penalty.
6. In the result, appeal of Assessee allowed.
Order pronounced in the open Court.
Sd/- Sd/-
(PRASHANT MAHARISHI) (BHAVNESH SAINI)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Delhi, Dated 11th October, 2019
VBP/-
Copy to
1. The appellant
2. The respondent
3. CIT(A) concerned
4. CIT concerned
5. D.R. ITAT "C" Bench
6. Guard File
// BY Order //
Asst. Registrar : ITAT Delhi Benches :
Delhi.
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