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2019 (12) TMI 773 - KARNATAKA HIGH COURTPenalty u/s 271(1)(c) - HELD THAT:- Disallowance made under Section 14-A of the Act and re-computation of deduction under Sections 10-A and 10-AA of the Act by recalling the original order and the same is pending adjudication before the Tribunal. The petitioner has filed an appeal against the order of penalty impugned herein and the said appeal is also pending consideration before the Appellate Authority. It is well settled law that the penalty is not automatic. In such circumstances, it was obligatory on the part of the Assessing Officer to consider the application of the petitioner staying the demand of penalty subject to the decision of the Tribunal/Appellate Authority. The same having been rejected, this Court deems it appropriate to direct the respondents not to enforce the demand relating to the penalty amount under the demand notice dated 23.4.2019 issued by the respondent No.1 under Section 156 relating to the assessment year in question until disposal of the proceedings pending before the Tribunal or the Appellate Authority challenging the order passed under Section 271(1)(c) of the Act, whichever is earlier and is ordered accordingly.
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