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2012 (10) TMI 778 - ITAT, DELHIJurisdiction power u/s 263 by CIT(A) - Failure of AO to initiate penalty proceedings while completing assessment under Section 143(3) - Held that:- The Assessing Officer while passing the assessment order under Section 143(3) had given an office note that the surrender of the agricultural income which was made by the assessee was subject to no penal action under Section 271(1)(c). A perusal of the same clearly shows that the assessee had made surrender with a clear condition that no penal action under Section 271(1)(c) would be initiated. The office note further depicts that the offer of the assessee was accepted by the department since the department had no documentary evidence against the assessee except the report of the Inspector. Once that was so, the department could not take somersault and seek to levy penalty. The penalty imposeable under sec. 271(1)(c) or under section 273(b) are independent proceedings then the assessment order. The penalty imposeable under sec. 273-B is to be imposed for false statement of/or failure to pay advance tax. Both these penalties are not dependent upon the assessment order but relying on decision taken in Additional Commissioner Of Income-Tax, Madhya Pradesh Versus Indian Pharmaceuticals [1978 (10) TMI 12 - MADHYA PRADESH HIGH COURT] AO has exercised his discretion for not visiting the assessee with the penalty. His order cannot be termed as erroneous and, therefore, no action under sec. 263 is justifiable - in favour of assessee.
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