S. 271(1)(c) : Penalty-Concealment-Notice must specify the charge- Notice must be precise and there should be no room for ambiguity- Veena Estate (P.) Ltd. v. CIT [2024] 158 taxmann.com 341 / 461 ITR 483 (Bom.)(HC), distinguished- Order of Tribunal is affirmed. [S. 260A]
The ITAT held that the penalty show cause notice was ambiguous, as the relevant portions were not ticked, or the irrelevant portions were not struck off. The Hon Court referred to the Full Bench decision, in the case of Mohd. Farhan A. Shaikh v. Dy. CIT [2021] 125 taxmann.com 253 / 280 Taxman 334/ 434 ITR 1 (FB) (Bom)(HC) , wherein it was held that if the notice contains no caveat that the inapplicable portion was to be deleted, any action based on such notice would be inferred. The Full Bench held that the notice must be precise and there should be no room for ambiguity. The Department relied upon Veena Estate (P.) Ltd. v. CIT [2024] 158 taxmann.com 341/ 461 ITR 483 (Bom)( HC) wherein, the Appellant- Assessee, who had never raised any ground about the ambiguity of the notice before the Assessing Officer, Appellate Authority and ITAT, attempted to raise such a ground for the first time in an Appeal under Section 260-A of the Income Tax Act. This was not allowed by the coordinate bench. The Hon Court observed that such facts do not exists in the present Appeal, and therefore, the decision in Veena Estate (P.) Ltd. (Supra) was distinguishable, the ITAT rightly followed the Full Bench in the case of Mohd. Farhan A. Shaikh (supra) [ITXA No. 58 of 2020, dt. 29/04/2025 (AY. 2011-12)
PCIT v. Pacific Organics Pvt. Ltd., (Bom.)(HC) www.itatonline.org
[Coram : Hon’ble Shri Justice M.S. Sonak and
Hon’ble Shri Justice Jitendra Jain]