IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, MUMBAI BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND SHRI PRABHASH SHANKAR, ACCOUNTANT MEMBER ITA No. 3021/MUM/2025 (AY: 2012-13)

(Physical hearing)

The Ruby Mills Limited DCIT, Circle – 8(3)(1), 11^th Floor, Ruby House A, J.K. Sawant Vs AayakarBhawan,Mumbai-400020.

Marg, Dadar West, Mumbai – 400028.

[PAN No. AAACT0220G]

Appellant / Assessee Respondent / Revenue Assessee by Ms. Simran Dhawan & Ravi Ganatra Advocates Revenue by Shri Umashankar Prasad, CIT-DR Date of institution of appeal 30.04.2025 Date of hearing 26.06.2025 Date of pronouncement 30.06.2025 Order under section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER:

1. This appeal by assessee is directed against the order of ld. CIT(A)/ NFAC dated

20.02.2025 for AY 2012-13. The assessee has following grounds of appeal:

1. On the facts and in the circumstances of the appellant company's case and in law, the Ld. Commissioner of Income Tax (Appeals), NFAC erred in upholding and not cancelling the penalty of Rs 34,61,587/- levied by the Assessing Officer u/s 271(1)(c) of the Income Tax Act, 1961 on 20.01.2022, despite the fact that the appellant has neither furnished inaccurate particulars of its income nor concealed its particulars of income.

2. On the facts and in the circumstances of the appellant company's case and in law, the Ld. Commissioner of Income Tax (Appeals), erred in confirming levy of penalty despite the fact that the Assessing Officer failed to arrive at satisfaction during the course of assessment proceedings whether the levy of penalty u/s 271(1)(c) was for furnishing inaccurate particulars of income or for concealment of income, which constitutes the basis and foundation of the proceedings for levy of penalty, thereby making the notice dated 30.03.2014 levying penalty u/s 274 r.w.s271 of the Income Tax Act, 1961 not in accordance with the provisions of law and without application of mind on the part of the assessing officer and penalty proceedings ought to be unstainable, illegal, invalid, bad-in-law, incorrect and in gross violation of principles of natural justice.

3. On the facts and in the circumstances of the appellant company's case and in law, the Ld. Commissioner of Income Tax (Appeals), erred in confirming levy of penalty failing to consider that the notice levying penalty failed to specify as to the limb under which penalty is sought to be imposed. i.e. Assessing Officer while issuing notice has to comethe conclusion that whether is it a case of concealment of income or is it a case of furnishing of inaccurate particulars disregarding the settled legal position including by Judgements of Hon'ble Karnataka High Court in the case of CIT v. Manjunatha Cotton & Ginning Factory [2013] 359 ITR 565/218 Taxman 423/35 taxmann.com 250, Hon'ble High Court of Delhi in the matter of Principal Commissioner of Income-tax v. Gopal Kumar Goyal [2023] 153 taxmann.com 534 (Delhi) and the Hon'ble High Court of Bombay in the matter of Principal Commissioner of Income-tax v. Jehangir H. C. Jehangir [2023] 155 taxmann.com 209 (Bombay).

4. On the facts and in the circumstances of the appellant company's case and in law, the Ld. Commissioner of Income Tax (Appeals), erred in confirming levy of penalty disregarding the well settled position in law including by the judgement of Hon'ble Supreme Court of India in the matter of Principal Commissioner of Income-tax v. Unitech Reliable Projects (P.) Ltd. [2024] 166 taxmann.com 135 (SC)[14-08-2024] wherein the Tribunal, having found that notice issued under section 274 did not specify as to limb under which penalty was sought to be imposed, i.e., notice did not indicate as to whether penalty was to be levied on account of concealment of income or for reason that assessee had furnished inaccurate particulars quashed penalty proceedings and High Court, on appeal, concluded that no substantial question of law arose for consideration as it was necessary for the Assessing Officer to ind