9911796707
TMI Blog2017 (8) TMI 475X X X X Extracts X X X X X X X X Extracts X X X X ..... therefore, the facts of the case relied upon by the assessee are not applicable to the assessee’s case. Hon’ble Allahabad High Court in [2004 (9) TMI 45 - ALLAHABAD High Court] relied upon by the CIT held that non-initiation of penalty proceedings renders the assessment as erroneous and prejudicial to the interest of the revenue. Similarly, in the case of CIT Vs. Ashok Construction Limited [2005 (1) TMI 18 - ALLAHABAD High Court ] held that non-initiation of penalty u/s 271B of the Act render the order erroneous and prejudicial to the interest of the revenue and upheld the revision u/s 263 of the Act. Therefore, we hold that the CIT(A) has rightly exercised the power u/s 263 of the Act and directed the A.O. to initiate penalty proceedings and no interference is called for. Appeal filed by the assessee is dismissed. - I.T.A.No.27/Vizag/2014 - - - Dated:- 21-6-2017 - SHRI V. DURGA RAO, JUDICIAL MEMBER AND SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER For The Appellant : Shri C. Kameswara Rao, AR For The Respondent : Shri R. Govinda Rajan, DR ORDER PER D.S. SUNDER SINGH, Accountant Member: This appeal filed by the assessee is directed against order of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tiate the penalty u/s 271(1)(c) of the Act. Initiation of penalty proceedings is a satisfaction of the assessing officer and the penalty proceedings required to be initiated during the assessment proceedings but not after completion of the assessment proceedings. The A.R. argued that on completion of the assessment proceedings, there were no proceedings pending and no penalty can be initiated u/s 271(1)(c). The Ld. CIT is empowered to revise the orders passed under various sections of the Act and in this case, there is no order which required to be revised. The Ld A.R further argued that the assessment order passed u/s 143(3) of the Act cannot be set aside for initiation of the penalty proceedings. There is no penalty order available to the CIT, which can be taken up for revision u/s 263 of the Act. Therefore, the Ld. A.R. contended that there is no error in the assessment order passed by the A.O. u/s 143(3) r.w.s. 147 of the Act, which is prejudicial to the interest of the revenue and the revision made u/s 263 of the Act is erroneous and bad in law, required to be quashed. The Ld. A.R. also relied on the decision of Hon ble Gujarat High Court judgment in the case of CIT Vs. Parman ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assed in any proceeding and, thus, the same would come under the exercise of revisional jurisdiction of section 263 of the Act. 6. Further, the Ld. D.R. submitted that the Act has been amended w.e.f. 1.6.2002 including the Principal Commissioner or Commissioner for the purpose of penalty u/s 271(1)(c) of the Act, thus the conjoint reading of section 271 263 of the Act establishes that the CIT is empowered u/s 263 of the Act to set aside the order passed by the A.O. for initiating penalty proceedings u/s 271(1)(c) of the Act, hence there is no error in the order of the CIT and the same required to be upheld. Rebutting the submissions made by the Ld. D.R., the Ld.A.R placed reliance on the Finance Act, 2002 and brought to our notice that the clarificatory amendments in section 271 of the Act relating to penalty for concealment of income etc. was amended to include the reference to the Commissioner as being an authority who can initiate penalty u/s 271 of the Act. Therefore, the Ld. A.R. contended that u/s 263 of the Act, the CIT can initiate the penalty but he cannot direct the A.O. to initiate penalty u/s 271 of the Act. Therefore, the Ld. A.R. affirmed that the order passed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee, such an order as the circumstances of the case justify including an order enhancing or modifying the assessment or cancelling the assessment and directing the fresh assessment. From section u/s 263 of the Act it is clear that the CIT is empowered to enhance, modify or direct the A.O. to re-do the assessment and set aside the assessment order. In this case, the assessing officer has not initiated the penalty proceedings which required to be initiated by him. The CIT has the powers vested under section 271(1)(c) to initiate penalty and consequently the CIT is empowered to get it done through the AO by virtue of powers vested in section 263 of Income tax act. Accordingly, the CIT has directed the A.O. to initiate the penalty proceedings u/s 271(1)(c). The Ld. A.R. relied on the judgement of Hon ble Gujarat High Court in the case of CIT Vs. Paramanand M Patel 278 ITR 0003 (2005) which was rendered before the amendment of section 271 of the Act. Section 271 of the Act is amended to include the Principal Commissioner/Commissioner to initiate the penalty proceedings by finance Act 2002, w.e.f.01/06/2002. Therefore, subsequent to the amendment of section 271 we are of the considered ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
