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These are the latest case laws decided by various Income Tax Appellate Tribunals (ITAT) of India on Income Tax which have been published recently. The case laws are open for discussion and we invite expert comments from our members on its applicability and effect on relevant issues.

03-07-2019, Rishabh Buildwell, Section 274, 271 (1 )(c), 271AAB, Tribunal Delhi

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1 week 3 days ago #9982 by amit
Section - 274, 271 (1 )(c), 271AAB, 153A, 139(1)
Order Date - 03-07-2019
Favouring - Assessee
Court - Tribunal Delhi
Appellant - Rishabh Buildwell P. Ltd.
Respondent - DCIT
Justice - H. S. Sidhu JM & Dr. B. R. R. Kumar AM
Citation - 719Taxpundit71
Appeal No. - ITA Nos. 6880 & 6881/Del/2018
Asstt. Year - 2011-12 & 2013-14

Order

PER : B. R. R. Kumar

The assessee has taken the following grounds of appeal:

“1. That the Ld. CIT(Appeals)-4, Kanpur has erred in law and on facts in confirming the penalty amounting to Rs. 61,80,000/- u/s 271(1 )(c) of the Income Tax Act, 1961, on erroneous understanding of facts and provisions of law.

2. That the Ld. CIT(Appeals)-4, Kanpur has erred in law and on facts in not considering that in the absence of statutory notice required in terms of section 274 of the Income Tax Act, 1961, in the prescribed format, the penalty proceedings(s) were not valid in law and the penalty order under appeal was liable to be cancelled.

3. That the Ld. CIT(Appeals)-4, Kanpur has erred in law and on facts in not considering that specific charge/default for which penalty was initiated was never crystallized and clearly stated neither the assessment order nor in any of the notice(s) therefore, the penalty imposed was also not valid in law and on facts and was liable to be cancelled.

4. That the Ld. CIT(Appeals)-4, Kanpur has erred in law and on facts in not considering that that A.O. did not specifically invoke Explanation 5A to Section 271 (1 )(c) of the Income Tax Act, 1961, neither in the Assessment Order nor in any of the notice(s) issued therefore, the imposition of penalty by the unilateral presuming that explanation 5 A to Sec. 271 (1 )(c) of the Income Tax Act, 1961 is applicable, was not sustainable in law and on facts.

5. That the Ld. CIT(Appeals)-4, Kanpur has erred in law and on facts in not considering and appreciating the conditions necessary for invocation of Explanation 5A to Section 271(1 )(c) of the Income Tax Act, 1961 were neither present in the facts of the present case nor the onus cast upon the A.O. for invocation of Explanation 5A to Section 271 (1 )(c) of the Income Tax Act, 1961 was discharged by him, therefore the penalty imposed was not sustainable in law and on facts.

6. That the Ld. CIT(Appeals)-4, Kanpur has erred in law and on facts in not considering and appreciating that the income in the return of Income filed in response to Notice u/s 153A of the Income Tax Act, 1961 and the assessed income assessed u/s 143(3)/153A of the Income Tax Act, 1961 were the same,
hence, the penalty imposed was insupportable in law and on facts and liable to be cancelled.

7. That the Ld. CIT(Appeals)-4, Kanpur has erred in law and on facts in not appreciating that the penalty could not have been levied for twin charges (for concealment of particulars of income and filing of inaccurate particulars) because both the charges given in section 271(1)(c) of the income Tax Act, 1961 are mutually exclusive situation and cannot co-exist therefore, the penalty imposed was bad in law and liable to be cancelled.

8. That the Ld. CIT(Appeals)-4, Kanpur has erred in law and on facts in not appreciating that it is essential on the part of the A.O. to inform the assessee that the penalty proceedings are being initiated against him by invoking Explanation to Section 271(1)(c) of the Income Tax Act, 1961, hence, in the absence of the same the penalty imposed is insupportable in law and on facts.

9. That the Ld. A.O. has not recorded satisfaction in accordance with section 271(1)(c) r.w.s. 271 (1B) of the Income Tax Act, 1961 therefore the impugned penalty order is void-ab- initio and liable to be quashed.

10. That the Ld. C.I.T. (Appeals)-4, Kanpur has erred in law and on facts by sustaining the penalty, which is wholly unjustified, without proper basis, too high & deserves to be deleted.

11. That the order of the Ld. C.I.T. (Appeals)-4, Kanpur is insupportable in law and on facts and is also contrary to the principles of natural justice and equity. That any other relief or reliefs as may be deemed fit in the case & circumstances of the case be granted.”

2. In ITA No.7139/Del/2018, the relevant grounds are as under:

“4. That the Ld. AO has not recorded satisfaction in accordance with section 271AAB r.w.s. 271(1B) of the Income Tax Act, 1961 therefore the impugned penalty order is void-ab-initio and liable to be quashed.

7. That the Ld. CIT(Appeals)-4, Kanpur has erred in law and on facts in not appreciating that the penalty could not have been levied for twin charges (for concealment of particulars of income and filing of inaccurate particulars) because both the charges given in the jurisdictional notice issued under section 271AAB of the Income Tax Act, 1961 are mutually exclusive situation and cannot co-exist therefore, the penalty imposed based on such understanding of law is liable to be cancelled.

8. That the Ld. CIT(Appeals)-4, Kanpur has erred in law and on facts in not appreciating that it is essential on the part of the AO to inform the assessee that the penalty proceedings are being initiated against him under Section 271AAB of the Income Tax Act 1961, hence, in the absence of the same the penalty imposed is insupportable in law and on facts.”

2. Since, the issue being dealt in both the appellants is similar except the quantum involved, they are being adjudicated together for the sake of convenience.

3. In the case of Rishabh Buildwell Pvt. Ltd., the quantum of the penalty for the assessment year 2011-12 was of Rs.6180000/- and for the assessment year 2013-14 was Rs.148200/-. In these cases, the assessment was completed u/s. 153A on 30.12.2016 and simultaneously, penalty proceedings u/s. 271(1)(c) were initiated by the AO and the penalty was levied vide order dated in the case of Shri Sanjeev Jain, the quantum of the penalty for the assessment year 2009-10 was Rs.24,00,000/-, for A.Y. 2010-11 the penalty was Rs. 21,88,500/-, for the A.Y. 2011-12 the amount was

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