2007 (9) TMI 673 - HC - Income Tax

Summary

Issues involved: Appeal against penalty under u/s 271(1)(c) of the Income Tax Act, 1961 for assessment year 1996-97.

Summary:
The appeal was filed against the order of the Income Tax Appellate Tribunal which had set aside the penalty imposed on the Assessee under Section 271(1)(c) of the Act. The Tribunal's decision was based on the fact that the Assessing Officer had not recorded any satisfaction in the assessment order regarding concealment or inaccurate particulars by the Assessee. The Revenue argued that as per a previous court decision, the satisfaction of the Assessing Officer should be recorded in the assessment order for penalty proceedings to be valid. However, another court decision raised the question of whether the satisfaction can be discerned from the order itself, even if not explicitly stated. The Supreme Court had upheld the requirement of recording satisfaction in the assessment order in previous cases. The court decided to examine the assessment order in the present case to determine if the satisfaction of the Assessing Officer was discernible. Upon review, it was found that the assessment order did not meet the requirement of Section 271(1)(c) as explained in previous court decisions. Therefore, the court dismissed the appeal, stating that no substantial question of law arose in this case.