ITAT Quashes Penalty Notice Which Was Silent On Specification Of Charges
Mariya Paliwala
14 April 2023 2:56 PM IST
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has quashed the penalty notice, which was silent on the specification of charges.The bench of Astha Chandra (a judicial member) and Shamim Yahya (an accountant member) has observed that no specification of charge in the penalty notice leads to the same becoming void, and the penalty on that count is to be deleted.The penalty...
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has quashed the penalty notice, which was silent on the specification of charges.
The bench of Astha Chandra (a judicial member) and Shamim Yahya (an accountant member) has observed that no specification of charge in the penalty notice leads to the same becoming void, and the penalty on that count is to be deleted.
The penalty under Section 271(1)(c) of the Income-tax Act, 1961, was levied upon the assessee on account of additions for unexplained cash credits and commissions at 5%. The total penalty levied was Rs. 90,52,387.
The assessee contended that the penalty notice was an omnibus notice without specifying the charge. Since the notice did not specify the charge, the penalty levied was liable to be quashed.
The Tribunal has noted that the notice is an omnibus notice without specifying the specific charge upon the assessee, and in such circumstances, higher courts have held that the penalty levied is not sustainable.
"Due to a defect in the penalty notice, the penalty is not sustainable, and hence the same is quashed. Since we have quashed the penalty for defective notice, merits are not being discussed as they are only academic in interest," the ITAT said.
Case Title: M.A. Projects Private Limited Versus ACIT
Citation: ITA No.1636/Del./2022
Date: 12.04.2023
Counsel For Appellant: Suresh Gupta
Counsel For Respondent: Sarita Kumari
