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2022 (11) TMI 1170 - AT - Income TaxPenalty proceedings u/s 271D - contravention of provisions of section 269SS - recording of satisfaction for penalty proceedings - HELD THAT:- We find considerable force in the contention of the assessee that the penalty order passed u/s 271D of the Act is void ab initio and bad in law as there was no satisfaction recorded by the AO as to the contravention of provisions of section 269SS while framing the assessment order under section 143(3) - On perusal of the assessment order the AO initiated penalty proceedings u/s 271(1)(c) and there is no satisfaction recorded for initiation of proceedings u/s 271D nor given any finding that there is any contravention of provisions of section 269SS of the Act. Following the decision of the Hon’ble Supreme Court and various Tribunals held that in the absence of recording of satisfaction in the assessment order for initiation of penalty proceedings under section 271D/271E of the Act, the penalty order is bad in law. Respectfully following the decision of the Hon’ble Supreme Court in the case of CIT Vs. Jai Laxmi Rice Mills [2015 (11) TMI 1453 - SUPREME COURT] we hold that the penalty order passed under section 271D of the Act is bad in law and accordingly the same is quashed. Ground No. 1 of the grounds of appeal of the assessee is allowed.
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