Ganesh Prasad Khetan Vs DCIT (ITAT Raipur)
ITAT Raipur held that penalty u/s. 271(1)(c) of the Income Tax Act is liable to be struck down for the failure on the part of the A.O. to put the assessee to notice as regards the default for which penalty under Sec. 271(1)(c) was sought to be imposed.
Facts- The assessee is an individual. The case of the assessee was subsequently reopened u/s. 147 r.w.s. 144B of the Act. Assessment u/s. 147 r.w.s. 144B of the Act was culminated on 26.03.2022, wherein penalty proceedings u/s.271(1)(c) of the Act were separately initiated by the A.O for “concealment of income”.
In due course of penalty proceedings u/s.271(1)(c) of the Act, the A.O. noted that the assessee had committed a default of deliberately concealed income to the tune of Rs.48,04,380/-. At the same time, it is also mentioned by the A.O that “I am satisfied that the assessee has furnished inaccurate particulars of income to the extent of Rs.48,04,380/-“, therefore, the provisions of Section 271(1)(c) of the Act are triggered and penalty of Rs.15,19,710/- was imposed on the assessee vide order dated 20.09.2022.
CIT(A) dismissed the appeal. Being aggrieved, the present appeal is filed.
Conclusion- Hon’ble High Court of Bombay in the case of Mohd. Farhan A. Shaikh V. DCIT, Central Circle-1, Bengaluru (2021) 280 Taxman 334 (Bombay), had observed that where the assessment order clearly records a satisfaction for imposing penalty on one or other; or both grounds mentioned in Sec. 271(1)(c), but there is a defect in the SCN, wherein the AO had failed to strike-off the irrelevant default, then, the same would vitiate the penalty proceedings.
