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2014 (6) TMI 16 - ALLAHABAD HIGH COURTDeletion of penalty u/s 271(1)(c) of the Act - Interest on Sugar Development Fund – Held that:- The absence of a reference to the initiation of proceedings u/s 271(1)(c) is not an inadvertent omission since it is clear that in respect of several other heads, where the AO did consider it appropriate to initiate penalty proceedings, he made an observation to that effect - the AO issued a direction for initiating penalty notice u/s 271(1)(c) "as discussed above" - The expression "as discussed above" is material because it refers to those heads in respect of which a specific direction was issued by him for initiating steps u/s 271(1)(c) – Relying upon MAK Data P. Limited Vs. Commissioner of Income Tax [2013 (11) TMI 14 - SUPREME COURT] - the AO has to satisfy himself whether penalty proceedings should be initiated or not during the course of assessment proceedings and he is not required to record his satisfaction in a particular manner or reduce it into writing - there is no direction whatsoever by the AO in respect of the specific head of interest on the SDF loan, on which the penalty was deleted by the Tribunal - The omission in the case of the SDF loan stands in sharp contrast to those items where the AO has specifically directed the initiation of penalty proceedings u/s 271(1)(c) – thus, the Tribunal was justified in deleting the penalty u/s 271(1)(c) in respect of the SDF loan – no substantial question of law arises for consideration – Decided against Revenue.
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