PCIT-16 Vs Times Global Broadcasting Ltd (Bombay High Court)
Bombay High Court has dismissed an appeal filed by the Principal Commissioner of Income Tax-16 (PCIT-16) against Times Global Broadcasting Ltd. for the assessment year 2010-2011. The core of the dispute revolved around the validity of a penalty imposed under Section 271(1)(c) of the Income Tax Act, 1961, specifically concerning the clarity of the show-cause notice issued to the assessee.
The Issue of Ambiguous Penalty Notices
The Revenue had proposed two substantial questions of law. Firstly, whether the Income Tax Appellate Tribunal (ITAT) was justified in deleting the penalty by holding that the notice issued under Section 274 read with Section 271(1)(c) was vague due to the Assessing Officer (AO) not specifying the exact limb of the penalty (i.e., whether for concealment of income or furnishing inaccurate particulars). The Revenue argued that the assessment order had already indicated default on both counts, making a specific tick in the notice unnecessary. Secondly, the Revenue questioned whether the notice should be considered valid under Section 292B of the Act, which allows for notices to be deemed valid despite defects if they are in substance and effect in conformity with the Act.
Judicial Precedent from Full Bench
