Skill Promoters Private Limited Vs DCIT (ITAT Hyderabad)
Three Penalty Provisions, One Fatal Defect: Vague Charges Sink Four Penalties Before Hyderabad ITAT
Penalties Deleted for Failure to Specify the Charge
The Hyderabad ITAT has deleted penalties imposed on Skill Promoters Private Limited under Sections 271(1)(c), 270A and 271AAB, holding that the Assessing Officer had failed to clearly identify the applicable charge or statutory clause.
The consolidated order covered four assessment years arising from search proceedings. Although the underlying additions concerned unaccounted cash receipts and profits estimated on those receipts, the decisive issue was the absence of clear satisfaction and specific charges in the penalty proceedings.
The Tribunal found defects extending beyond the notices to the assessment and penalty orders. A general statement that penalty proceedings were being initiated, or that the case was fit for penalty, did not sufficiently identify the alleged default.
All four appeals were allowed.
Search and Estimation of Business Income
The assessee was engaged in construction and land development. A search under Section 132 was conducted on the Skill Promoters group and associated entities on 22 October 2019.
For Assessment Year 2016-17, the ensuing assessment included additions concerning unaccounted cash receipts. The quantum dispute eventually reached the Tribunal.
