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Smt. Harmeet Kaur Sran, 527B, 5th Floor, HBN Office, D-Mall, Dist. Centre, Paschim Vihar, New Delhi 110 087. vs. The DCIT, Central Circle 29, New Delhi.
October, 14th 2019

Referred Sections:
Section 271(1)(c) of the I.T. Act, 1961.

Referred Cases / Judgments:
Mr. Vijay Aggarwal, Meerut vs. DCIT, Central Circle-1, Faridabad, Dated 09.08.2019
Faridabad vs., DCIT, Circle-1, Faridabad, Dated 04.10.2019 in ITA.No.4747/Del/2016,
Pr. CIT vs. M/s. Sahara India Life Insurance Company Ltd., 2019 (8) TMI 409 (Del.)
Sundaram Finance Ltd., vs. CIT [2018] 93 taxmann.com 250 (Mad.)
CIT vs. M/s. SSAs Emerald Meadows 73 taxmann.com 241 (Kar.)
CIT vs. M/s. Sahara India Life Insurance Company Ltd.,

       IN THE INCOME TAX APPELLATE TRIBUNAL
              DELHI BENCHES "C": DELHI

  BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER
                     AND
  SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER

                  ITA.No.2644/Del./2017
                Assessment Year 2007-2008

Smt. Harmeet Kaur Sran,            The DCIT,
527B, 5th Floor, HBN
Office, D-Mall, Dist.        vs., Central Circle ­ 29,
Centre, Paschim Vihar,
New Delhi ­ 110 087.               New Delhi.
PAN BMJPS0698L
         (Appellant)                      (Respondent)

               For Assessee : Shri Varun Jain, C.A.
               For Revenue : Ms. Rakhi Vimal, Sr. D.R.

            Date of Hearing : 09.10.2019
     Date of Pronouncement : 11.10.2019

                           ORDER

PER BHAVNESH SAINI, J.M.

          This appeal by Assessee has been directed against

the Order of the Ld. CIT(A)-30, New Delhi, Dated 30.01.2017

for the A.Y. 2007-2008, challenging the levy of penalty

under section 271(1)(c) of the I.T. Act, 1961.
                                2
                                    ITA.No.2644/Del./2017 Smt. Harmeet
                                                  Kaur Sran, New Delhi.


2.          We have heard the Learned Representatives of

both the parties and perused the material on record.


3.          Learned Counsel for the Assessee submitted that

A.O. has issued show cause notice before levy of the penalty

Dated 23.12.2011 in which A.O. has mentioned as under :


       "Have concealed the particulars of your income or

       furnished inaccurate particulars of such income."


3.1.        He has submitted that A.O. in the assessment

order has initiated the penalty proceedings under section

271(1)(c) of the I.T. Act for concealing the particulars of

income, however, in the penalty Order, A.O. has held that

assessee is in default for concealing his income by

furnishing inaccurate particulars of his income. He has,

therefore, submitted that it is not discernible as to whether

penalty proceedings are initiated for furnishing inaccurate

particulars of income or for concealment of income and,

therefore, penalty is liable to be quashed.


4.          The Ld. D.R. on the other hand, relied upon the

Orders of the authorities below and submitted that this
                              3
                                  ITA.No.2644/Del./2017 Smt. Harmeet
                                                Kaur Sran, New Delhi.


point have not been raised by assessee and essentially it is

an issue of fact, therefore, this ground cannot be considered

in favour of the assessee and relied upon Order of ITAT,

Delhi G-Bench in the case of Mr. Vijay Aggarwal, Meerut vs.,

DCIT, Central Circle-1, Faridabad, Dated 09.08.2019 in

ITA.Nos.5434 & 5435/Del./2016 for the A.Ys. 2008-2009

and 2009-2010.







5.         We have considered the rival submissions. The

ITAT, Delhi C-Bench in the case of Hemla Embroidery Mills

Private Ltd., Faridabad vs., DCIT, Circle-1, Faridabad,

Dated 04.10.2019 in ITA.No.4747/Del/2016, for the A.Y.

2012-2013, have decided the identical issue and the

findings of the Tribunal are as under :


        "IN THE INCOME TAX APPELLATE TRIBUNAL
               DELHI BENCHES "C": DELHI

      BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER
                         AND
     SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER

                   ITA.No.4747/Del./2016
                 Assessment Year 2009-2010
                                 4
                                     ITA.No.2644/Del./2017 Smt. Harmeet
                                                   Kaur Sran, New Delhi.


Hemla Embroidery Mills           The DCIT,
Private Ltd., 14/6, Mathura vs.,
                                 Circle-1,
Road, Faridabad.
PAN AAACH4302B                   Faridabad.
          (Appellant)                          (Respondent)

                 For Assessee : Shri M.P. Rastogi, Advocate.
                  For Revenue : Shri S.S. Rana, CIT-D.R.

           Date of Hearing : 03.10.2019
     Date of Pronouncement : 04.10.2019

                               ORDER

     PER BHAVNESH SAINI, J.M.

           This appeal by Assessee has been directed against

     the    Order   of   the   Ld.   CIT(A),   Faridabad,       Dated

     01.07.2016 for the A.Y. 2009-2010, challenging the levy

     of penalty under section 271(1)(c) of the I.T. Act, 1961.


     2.          We have heard the Learned Representatives

     of both the parties.


     3.          The assessee has challenged the levy of

     penalty in this case as well as raised additional ground

     of appeal stating therein that notice issued before levy

     of the penalty is bad in law and is vague and did not

     provide as to under which limb of Section 271(1)(c) of
                             5
                                 ITA.No.2644/Del./2017 Smt. Harmeet
                                               Kaur Sran, New Delhi.


the I.T. Act, penalty proceedings have been initiated.

Therefore, the entire penalty order is illegal and void in

law. Since it is a legal issue, therefore, same is admitted

for disposal of the appeal.


4.          Learned Counsel for the Assessee referred to

show cause notice Dated 30.12.2011 issued before levy

of the penalty in which the A.O. has mentioned as

under:


       "Have concealed the particulars of your income or

       furnished inaccurate particulars of such income."


4.1.        He has, also referred to show cause notice

Dated 13.02.2015 before levy of the penalty in which

A.O. has mentioned as under :


       "In this regard it may be noted that hearing with

       respect to imposition of penalty u/s 271(l)(c) in your

       case for the assessment year 2009-10 is fixed for

       23.02.2015 at 11:30 A.M. It is requested that you may

       either attend or submit a written reply to this office by
                             6
                                 ITA.No.2644/Del./2017 Smt. Harmeet
                                               Kaur Sran, New Delhi.


       the said date, failing which it shall be presumed that

       you have nothing to say in this matter and your case

       shall be decided on merits. If you have already filed

       any reply, please file a copy of the same."


4.2.         He has, therefore, submitted that penalty is

illegal and bad in law and submitted that the issue is

covered by the Judgment of the Hon'ble Delhi High court

in the case of Pr. CIT vs. M/s. Sahara India Life

Insurance Company Ltd., 2019 (8) TMI 409 (Del.) vide

Judgment Dated 02.08.2019 in paras 21 and 22 held

as under :


       "21. The Respondent had challenged the upholding

       of the penalty imposed under Section 271(1) (c) of the

       Act, which was accepted by the ITAT. It followed the

       decision of the Karnataka High Court in CIT v.

       Manjunatha Cotton & Ginning Factory 359 ITR 565

       (Kar) and observed that the notice issued by the AO

       would be bad in law if it did not specify which limb of

       Section 271(1) (c) the penalty proceedings had been
                           7
                               ITA.No.2644/Del./2017 Smt. Harmeet
                                             Kaur Sran, New Delhi.







     initiated under i.e. whether for concealment of

     particulars of income or for furnishing of inaccurate

     particulars of income. The Karnataka High Court had

     followed the above judgment in the subsequent order

     in Commissioner of Income Tax v. SSA's Emerald

     Meadows (2016) 73 Taxman.com 241 (Kar), the appeal

     against which was dismissed by the Supreme Court of

     India in SLP No.11485 of 2016 by order dated 5th

     August, 2016.

     22.   On this issue again this Court is unable to find

     any error having been committed by the ITAT. No

     substantial question of law arises."

5.         The Ld. D.R. on the other hand, relied upon

the Orders of the authorities below and relied upon

Judgment of Hon'ble Madras High Court in the case of

Sundaram Finance Ltd., vs. CIT [2018] 93 taxmann.com

250 (Mad.) and Judgment of Hon'ble Supreme Court in

the case of Sundaram Finance Ltd., vs. CIT [2018] 99

taxmann.com 152 (SC).
                               8
                                     ITA.No.2644/Del./2017 Smt. Harmeet
                                                   Kaur Sran, New Delhi.


6.          We have considered the rival submissions. In

this case, the A.O. issued show cause notice for levy of

penalty in which A.O. has mentioned both the limbs of

section 271(1)(c) of the Act that assessee has concealed

the    particulars of income or furnished inaccurate

particulars of such income. The issue of the notice is

bad in law as it did not specify under which limb of

Section 271(1)(c) of the I.T. Act, penalty proceedings

have    been      initiated    whether      for   concealment        of

particulars of      income      or furnishing        of   inaccurate

particulars of income. The issue is, therefore, covered by

Judgment of Hon'ble Karnataka High Court in the case

of    CIT   vs.    M/s.       SSAs     Emerald       Meadows        73

taxmann.com 241 (Kar.) and confirmed by the Hon'ble

Supreme Court reported in 73 taxmann.com 248 (SC).

Further, the Hon'ble Delhi High court in the case of Pr.

CIT vs. M/s. Sahara India Life Insurance Company Ltd.,

(supra) decided the same issue in favour of the

assessee. Following the same, we are of the view that

since notice is bad in law, therefore, the entire penalty
                                 9
                                     ITA.No.2644/Del./2017 Smt. Harmeet
                                                   Kaur Sran, New Delhi.


        proceedings are vitiated and as such no penalty is

        leviable against the assessee. We, accordingly, set

        aside the Orders of the authorities below and cancel the

        penalty.


        7.         In the result, appeal of assessee allowed."


5.1.         Following the same, we set aside the Orders of

the authorities below and cancel the penalty.


6.           In the result, appeal of Assessee allowed.


             Order pronounced in the open Court.


 Sd/-                                     Sd/-
(PRASHANT MAHARISHI)                     (BHAVNESH SAINI)
ACCOUNTANT MEMBER                       JUDICIAL MEMBER
Delhi, Dated 11th October, 2019
VBP/-
Copy to
1.     The appellant
2.     The respondent
3.     CIT(A) concerned
4.     CIT concerned
5.     D.R. ITAT "C" Bench
6.     Guard File
                         // BY Order //



              Asst. Registrar : ITAT Delhi Benches :
                               Delhi.

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