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2014 (3) TMI 253 - AT - Income TaxValidity of order of Penalty – Bar of limitation – Notice issued beyond Prescribed time – Held that:- According to section 158BFA(3) shows that penalty proceedings should be completed within the financial year or within six months from the end of the month in which the proceedings are initiated, whichever is later - After issuance of notice u/s.158BFA(2) on 29-10-2004, the Revenue has not taken any action within the time limit prescribed under the Act for levy of penalty against the assessee - The assessee filed an appeal before the CIT(Appeals) much after the period of expiry of limitation - The Revenue was under no obligation to wait for the assessee to file an appeal against assessment order after the limitation period was over. After issuance of notice, the Revenue ought to have completed penalty proceedings within the period prescribed under the Act without waiting for the assessee to file appeal against the assessment order beyond the period of limitation - The second notice issued u/s.158BFA(2) does not confer any power to Revenue to Denovo penalty proceedings against the assessee - The Act specifically provides for the time limit within which order imposing penalty has to be passed - The statutory time limit cannot be enlarged with the issuance of fresh notice – Revenue failed to complete penalty proceedings within the statutory time frame – thus, the penalty order dated 23-10-2009 is bad in law – thus, the order set aside – Decided in favour of Assessee.
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