After search and seizure operations, assessee declared certain undisclosed income which was added to income disclosed in returns filed in response to notice issued under section 153A. Assessment orders were followed by notices under section 271(1)(c) read with section 274 and after considering assessee’s submissions, Assessing Officer levied penalty under section 271(1)(c). On appeal, Tribunal cancelled penalty on ground that show cause notice under section 274 was defective as it did not spell out grounds on which penalty was sought to be imposed. On appeal by revenue the Court held that   when Assessing Officer had recorded in assessment order particulars of concealed income/undisclosed income of assessee and on that basis initiated penalty proceeding under section 271(1)(c), then consequential notice under section 274 issued by Assessing Officer to assessee to afford him opportunity of hearing, was specifically a notice for penalty for concealment of particulars of income/undisclosed income. Such a notice complied with principles of natural justice and was a valid notice under section 274 and Tribunal had committed a manifest error of law by setting aside penalty orders on ground that ‘grounds for imposition of penalty were not mentioned in show cause notice under section 274 and thus, show cause notice was defective. Matter remanded to the Tribunal to decide on merits.   (AY. 2006-07, 2007-08)