IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI BENCH, RANCHI BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI RATNESH NANDAN SAHAY, ACCOUNTANT MEMBER I.T.A. No. 89/Ran/2022 (Assessment Year-2015-16)

(Virtual Hearing)

Alliance Dealers Private Limited, D.C.I.T., CA Akshay Ringasia, Suite No. 3, 2nd Central Circle, Vs.

Floor, Aviskar Bumra Enclave, Diagonal Jamshedpur.

Road, Bistupur, Jamshedpur-831001.

PAN No. AAHCA 2615 B Appellant/ Assessee Respondent/ Revenue Assessee represented by Shri Akshay Ringasia, C.A.

Department represented by Shri Khubchand T. Pandya, Sr.DR Date of hearing 10/03/2025 Date of pronouncement 10/03/2025

O R D E R

PER: BENCH

1. This appeal by the assessee is directed against the order of the learned Commissioner of Income Tax (Appeals), Patna-3, [in short, the ld. CIT(A)] dated 26/07/2022 for the Assessment Year (AY) 2015-16. In this appeal, the assessee has raised following grounds of appeal:

"1. That under the facts and circumstances of the case, no penalty u/s 271(1)(c)

should had been levied, hence, the impugned order levying penalty of Rs.

2,62,650/-needstobequashed.

2. ThattheveryinitiationofpenaltyisbadinlawastheLd.AOhasfailedtorecord a proper or transparent satisfaction in his notice while initiating proceedings under section 271(1)(c), thus rendering the entire penalty proceedings null and void.

3. That under the facts and circumstances, the initiation of penalty proceedings under section 271(1)(c) are illegal and unsustainable in law, in view of legal interpretation and the settled judicial pronouncement by various courts and benchesoftribunals.

4. That without prejudice, by no stretch of imagination could the assessee be subjected to penalty for concealment when the return income itself was accepted without modification and there was no undisclosed income which is sinequanonforinvokingsection271(1)(c).

5. Thattheassesseecraveslavetoadd,alteroramendanygroundbeforeoratthe timeofhearing."

2. Rival submissions of both the parties have been heard and record perused. At the outset of hearing, the learned Authorised Representative (ld. AR) of the assessee submits that in the grounds of appeal, the assessee has claimed that the ld. CIT(A) erred in confirming the order passed by the ld. DCIT, Central Circle Jamshedpur, based on defective notice u/s 274 of the Act and further erred in not following the precedence of the predecessor CIT(A) as also in not following the directions of the jurisdictional Tribunal as well as the Hon'ble Supreme Court of India.

3. The facts of the case are that a search operation was conducted under Section

132(1) of the Income tax Act, 1961 (in short, the Act) in this case on 17.08.2017 during which the assessee offered undisclosed income in the statement recorded u/s 132(4) of the Act and paid the due taxes while filing return in response to notice u/s 153A. The assessee admitted the allegation of the AO regarding certain manipulation in the transaction of shares to earn long term capital gains to buy peace and the return of income was also accepted by the AO. Subsequently, notice u/s 274 of the Act was issued for initiation of penalty u/s 271(1)(c) of the Act. The AO imposed the penalty accordingly and this order was upheld by the ld. CIT(A).

4. Before the ld.CIT(A),the assessee claimed that the AO in the show cause notice for levying penalty did not specifically pointed out as to whether the penalty was w.r.t. concealment of income or furnishing inaccurate particular of income. Accordingly, the show cause notice was claimed to be defective on which no penalty could be imposed. The ld.CIT(A),however, rejected the contention of the assessee and held that mere not striking off of one limb in the show cause notice issued u/s 274 of the Act will not invalidate the whole penalty order.

5. Before us, the ld. AR of the assessee appeared and filed a written submissions In the written submission, it has claimed that during assessment proceedings u/s 153A, all the details were provided to the ld. AO an