No Penalty shall be Imposed u/s 271(1)(c) of Income Tax Act without Issue of Notice Specifying Charge: ITAT [Read Order]
Penalty – Imposed – us – 271(1)(c) – of – Income – Tax – Act – Notice – Specifying – Charge – ITAT – TAXSCAN
Penalty – Imposed – us – 271(1)(c) – of – Income – Tax – Act – Notice – Specifying – Charge – ITAT – TAXSCAN
The Delhi bench of Income Tax Appellate Tribunal (ITAT) held that no penalty should be imposed under Section 271(1)(c) of Income Tax Act, 1961 without issue of notice specifying charge.
Assessee M.A. Projects Private Limited filed the appeal against the order of CIT(A) on challenging the penalty levied under section 271(1)(c) of Income Tax Act on account of additions for unexplained cash credit and commission at 5%.
The CIT(A) confirmed the penalty levied by the AO when the matter was filed before it. Thereafter, the appeal was filed before the tribunal for adjudication.
Suresh Gupta, counsel for the assessee before the tribunal, submitted that penalty notice was an omnibus notice and the authority did not specify the charge issued the notice.
Sarita Kumari, counsel for the revenue, supported the decision of the lower authorities.
The tribunal while considering the submission observed that when no specification of charge in the penalty notice leads to the same becoming void and penalty on that count is to be deleted.
Therefore the two member bench of Shamim Yahya, (Accountant Member) and Astha Chandra, (Judicial Member) observed that the penalty notice issued by the authority was defective. Due to that, the bench allowed the appeal filed by the assessee.
To Read the full text of the Order CLICK HERE
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