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2019 (8) TMI 630 - HC - Income TaxRevision u/s 263 - Penalty u/s 271(1)(c) - period of limitation u/s 275 - why the order passed by the AO dropping the penalty proceedings should not be revised? - HELD THAT:- Tribunal, after examining the factual position and taking note of the legal submissions made on behalf of the assessee as well as the Revenue, allowed the appeal. The appeal was allowed by the Tribunal considering the fact situation to examine as to whether the penalty could have been imposed beyond the period of limitation. The action for initiation of the penalty under Section 271(1)(c) of the Act had been initiated in the course of assessment proceedings itself under Section 143(3) read with Section 153A of the Act on 31.3.2016. Time limit for levy of penalty under Section 271(1)(c) of the Act would expire in the present case on 31.9.2016, being six months from the end of the month, in which, the penalty proceedings have been initiated. Now, after the expiry of the said limitation, the learned Principal Commissioner of Income Tax has issued the show cause notice on 09.3.2018 for reviving the penalty proceedings, which had already expired and was barred by limitation. True, the order passed by the learned Assessing Officer dropping the penalty proceedings is an unspeaking order, but still, that would not make it valid reason for extending the limitation provided under Section 275 of the Act for the purpose of levying the penalty or for considering the levy of penalty under Section 271(1)(c) of the Act by invoking the powers of revision under Section 263 of the Act. In the circumstances, the order passed under Section 263 of the Act, being unsustainable in law, stands quashed - Decided in favour of assessee.
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