Penalty Proceedings invalid if initiated on the basis of Defective Notice

Shri R. Sathiamurthy Vs ITO (ITAT Chennai)

ITAT held that If very initiation of penalty proceedings on a defective notice is invalid and it do not warrant imposition of penalty u/s.271(1)(c) of the Act on the assessee.

FULL TEXT OF THE ORDER OF ITAT DELHI

This appeal by the assessee is arising out of the order of Commissioner of Income Tax (Appeals), Puducherry in ITA No.434/CIT(A)-PDY/2013-14 dated 09.05.2016. The assessment was framed by the ITO, Ward 1(3), Cuddalore for the assessment year 2009-10 u/s.143(3) of the Income Tax Act, 1961 (hereinafter the ‘Act’) vide order dated 27.12.2011. The penalty under dispute u/s.271(1)(c) of the Act was levied by the ITO, Ward (3), Cuddalore vide his order dated 28.06.2012.

2. At the outset, the ld.counsel for the assessee stated that the penalty u/s.271(1)(c) of the Act is without jurisdiction and for this, he drew our attention to first two grounds raised, which reads as under:-

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