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2016 (2) TMI 1373 - AT - Income TaxPenalty u/s 271D - foundation of the penalty proceedings not in existence - whether no proceedings were initiated or pending in respect of the captioned assessment year, penalty proceedings u/s 271D or 271E can be initiated? - case of the assessee is that the original assessment order was passed by the Assessing Officer u/s 143(3) on 08/10/2009 and thereafter, learned CIT passed order u/s 263 of the Act as per which learned CIT set aside the said assessment order dated 08/10/2009 and directed the Assessing Officer to re do the assessment - Subsequently, the order of learned CIT u/s 263 of the Act was set aside by the Tribunal and therefore, now the surviving order is the original assessment order passed by the Assessing Officer u/s 143(3) on 08/10/2009 HELD THAT:- As per the penalty order passed u/s 271D on 27/11/2012, we find that the same is on the basis of fresh assessment order passed by the Assessing Officer u/s 144/263 on 28/12/2011, which does not survive because the order of learned CIT u/s 263 was set aside by the Tribunal and therefore, the consequential order of the Assessing Officer u/s 144/263 does not survive. It is also seen that the notice u/s 271D was issued on 11/05/2012 and 12/10/2012 and the order u/s 271D was passed on 27/11/2012. As decided in Baldev Singh [2012 (2) TMI 650 - ITAT CHANDIGARH] there is no merit in initiation of penalty proceedings u/s 271D and 271E because no proceedings for the relevant year were pending at the relevant point of time. In the present case also, when proceedings were initiated u/s 271D on 01/05/2012, no proceedings were pending in respect of the present assessment year. In fact, the original assessment order was passed by the AO u/s 143(3) on 08/10/2009 and subsequent assessment year u/s 144/263 was also already passed on 28/12/2011 and this is admitted position that in course of original assessment proceedings completed on 08/10/2009, there was no whisper about initiation of proceedings u/s 271D of the Act. In our considered opinion, under the facts of the present case, this Tribunal order rendered in the case of Baldev Singh (supra) and also in the case of Manohar Lal [2011 (1) TMI 538 - PUNJAB AND HARYANA HIGH COURT] are squarely applicable and hence, respectfully following these judgments, we hold that the penalty imposed by the AO in the present case is not valid because the initiation of penalty proceedings is not valid in the eyes of law. We, therefore, delete the penalty.Apeal of the assessee stands allowed.
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