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2020 (12) TMI 82 - AT - Income TaxPenalty u/s 271(1)(b) - non-compliance to statutory notices - HELD THAT:- Default of non-attendance to notices was not the subject-matter in the quantum appeal and it in no way depended upon the outcome in the appeal. The penalty depends upon whether the default was willful or not. Therefore, we are of the view that the ratio of the case of Hissaria Bros. [2006 (7) TMI 163 - RAJASTHAN HIGH COURT] will be applicable in this case also. Recording of satisfaction - It may be mentioned that mere initiation of penalty does not amount to satisfaction as held in the case of CIT v. Ram Commercial Enterprises Ltd. [1998 (10) TMI 13 - DELHI HIGH COURT]. In absence of recording of the satisfaction in the assessment order, mere initiation of penalty will not confer jurisdiction on the AO to levy the penalty. The order was passed under s. 143(3) and not under s. 144 of the Act. This means that subsequent compliance in the assessment proceedings was considered as good compliance and the defaults committed earlier were ignored by the AO. Therefore, in such circumstances, there could have been no reason to come to the conclusion that the default was willful. See AKHIL BHARTIYA PRATHMIK SHIKSHAK SANGH BHAWAN TRUST. VERSUS ASSISTANT DIRECTOR OF INCOME-TAX. [2007 (8) TMI 386 - ITAT DELHI-G] - Decided in favour of assessee.
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