2007 (9) TMI 643 - HC - Income Tax

Summary

Issues involved: Appeal u/s 260A of the Income-tax Act, 1961 challenging penalty under section 271(1)(c) for assessment years 2001-02 and 1999-2000.

For the assessment year 2001-02:
The High Court considered the appeal against the order of the Income-tax Appellate Tribunal, which had set aside the penalty under section 271(1)(c) of the Act due to lack of recorded satisfaction by the Assessing Officer regarding concealment of income or inaccurate particulars. The revenue argued for awaiting a decision from a larger Bench on whether satisfaction can be discerned from the assessment order itself. The Court noted that the assessment order did not meet the requirement of section 271(1)(c) as per previous judgments and found no discernible satisfaction for initiating penalty proceedings. With the tax effect below the limit, the Court held that no substantial question of law arose and dismissed the appeal.

For the assessment year 1999-2000:
In this case, the Tribunal also set aside the penalty under section 271(1)(c) citing the absence of recorded satisfaction by the Assessing Officer regarding concealment or inaccurate particulars. The revenue sought to await a decision from a larger Bench on the issue of discernible satisfaction from the assessment order. The Court reiterated the previous judgment's requirement for explicit satisfaction in the assessment order and found no such satisfaction discernible in the present case. Consequently, the Court held that no substantial question of law arose and dismissed the appeal.