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1. Valid initiation of penalty proceedings as per jurisdictional High Court's ratio 2. Judgment of jurisdictional High Court being per incuriam Issue 1: Valid initiation of penalty proceedings as per jurisdictional High Court's ratio The judgment revolves around the initiation of penalty proceedings under section 271(1)(c) in various appeals. The Assessing Officer had not explicitly expressed satisfaction in the assessment orders regarding the initiation of penalty proceedings. The Hon'ble jurisdictional High Court, in the case of CIT v. Ram Commercial Enterprises Ltd., emphasized that the mere mention of initiating penalty proceedings separately does not amount to satisfaction as required by section 271(1)(c). The Court held that the absence of explicit satisfaction in the assessment order renders the initiation of penalty proceedings invalid. This decision was consistently followed in subsequent cases like Diwan Enterprises v. CIT, CIT v. B.R. Sharma, and CIT v. Vikas Promotors (P.) Ltd. The Court concluded that penalties were not validly initiated in the cases at hand due to the lack of recorded satisfaction by the Assessing Officer in accordance with the law. Issue 2: Judgment of jurisdictional High Court being per incuriam The argument presented by the Departmental Representative contended that the judgment of the Hon'ble Delhi High Court in the case of Ram Commercial Enterprises Ltd. was per incuriam. The contention was based on the assertion that the High Court did not consider the complete observations of the Supreme Court in the case of S.V. Angidi Chettiar. The Departmental Representative highlighted that the High Court's judgment failed to acknowledge the significance of the endorsement at the foot of the assessment order indicating the satisfaction of the Income-tax Officer regarding concealment of income. However, the Tribunal rejected this argument, stating that the judgment could not be deemed per incuriam as it was not rendered in ignorance of relevant statutory provisions or binding authorities. The Tribunal further clarified that there was no conflict between the Supreme Court judgment and the High Court's decision, as the latter duly considered and applied the former's principles in its analysis. Consequently, the Tribunal upheld that the penalties were not validly initiated and canceled the penalty orders passed by the Assessing Officer, thereby allowing the appeals of the assessees. ---
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