The Income Tax Appellate Tribunal ( ITAT ), Delhi Bench, has recently, in an appeal filed before it, deleted the penalty proceedings, on finding that the notice issued u/s 271(1)(c) of Income Tax Act is omnibus.
The aforesaid observation was made by the Delhi ITAT, when an appeal by was filed before it by the assessee, as directed against the order of the CIT (Appeals)-, New Delhi, dated 15.05.2019, pertaining to Assessment Year 2012-13.
The grounds of the assessee’s appeal being that on the facts and in the circumstances of the case and in law, the CIT-A, has erred in sustaining the order passed by Ld. AO u/s 271(1)(c), that the CIT Appeals has not considered the fact that the Order u/s 250 against the assessment order 143(3) is still pending before CIT (Appeals) as the ITAT has remand back the order U/s 250 , and further that the CIT (Appeals), has not given the opportunity of being heard, while not considering the order of ITAT about the remand back of the appeal order U/s 250, Sh. Salil Kapoor, Adv. Sh. Sumit Lal chandadni, Adv. & Sh. Amarbir Singh, CA, the counsels on behalf of the assessee, filed an addition ground relating to the defective notice that the impugned notice issued by the Deputy Commissioner of Income Tax, Circle 19(2), is without jurisdiction and is therefore, illegal & bad in law.
With the appellant taking the grounds that, in view of the facts and circumstances of the case and in law, the impugned notice dated 17.02.2015 issued by Deputy Commissioner of Income Tax, Circle 19(2) under Section 274 read with section 271 of the Income Tax Act is defective and hence, theA0 has not assumed valid jurisdiction, he added that therefore, the penalty proceedings are liable to be dropped.
The appellant having further submitted that the relevant facts are already on record and no new fact is required to be thus, investigate, he added that the above noted ground goes to the root of the matter, thereby requesting that the same may kindly be admitted and adjudicated, placing reliance upon the decision of Supreme Court in the case NTPC 229 ITR 383 (SC).
Subsequently, thecounsel for the assessee having attached a copy of the notice , stating at bar that this was notice received by the assessee from the AO wherein the specific limb has not been identified as to whether the charge is for concealment of income or furnishing of inaccurate particulars of income, the Counsel for the assessee submitted that this issue stands squarely covered in favour of the assessee by several case laws including CIT vs SSA’S Emerald Meadowsand Pr. CIT vs Sahara India Life Insurance Company Ltd.
However, Sh. K.K. Mishra, the SR. DR, strongly justified the Revenue.
Hearing the opposing contentions of either sides, and thereby perusing the materials available on record, the Delhi ITAT Panel comprising of Astha Chandra, the Judicial Member, along with Shamim Yahya, the Accountant Member observed:
“Upon careful consideration and hearing both the parties, we admit the aforesaid additional ground. In the ground, it has been clearly stated that notice issued u/s 271(1)(c) is omnibus notice without specifying the specific charge upon the assessee as to whether it is for concealment of income or furnishing of inaccurate particulars of income. In this regard, we may gainfully refer to the order of the jurisdictional High Court in the case of Pr. CIT vs Sahara India Life Insurance Company Ltd. in CM Appeal No.19863/2019 vide order darted 02.08.2019 and others.”
Thus, allowing the assessee’s appeal, the Delhi ITAT held:
“From the above, it is evident that non-specification of the limb of the notice would render the penalty proceedings invalid. Accordingly, respectfully following the precedent, we set-aside the orders of the authorities below holding that notice u/s 271(1)(c) is omnibus notice, thus defective which goes to the root of the matter. Accordingly, the appeal of the assessee stands allowed.”
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
