TMI Blog1996 (5) TMI 14X X X X Extracts X X X X X X X X Extracts X X X X ..... the facts and in the circumstances of the case, the Tribunal was right in holding that the satisfaction of the Income-tax Officer for initiation of penalty proceedings under section 271(1)(c) was not restricted to Rs. 23,600 out of the entire addition of Rs. 32,707, and, as such, levy of penalty by the Income-tax Officer without previous approval of the Inspecting Assistant Commissioner was illegal? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that in view of clause (b) of sub-section (1) of section 251 of the Income-tax Act, the penalty order could not be remanded to the Income-tax Officer for curing the defect of not obtaining the previous approval of the Inspecting Assistant Commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Commissioner of Income-tax (Appeals) and raised an objection that the penalty order was invalid in law since the penalty was levied without the previous approval of the Inspecting Assistant Commissioner of Income-tax when the amount of income in respect of which the particulars were alleged as inaccurate or concealed, was Rs. 32,707, i.e. to say, in excess of Rs. 25,000. The Commissioner of Income-tax (Appeals) construed the assessment order as if the Income-tax Officer had initiated penalty proceedings in respect of unexplained investment of Rs. 23,600 only. The Commissioner of Income-tax (Appeals) thus confirmed the addition (penalty?). The assessee came in second appeal before the Tribunal. The Tribunal reached the conclusion that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stion of jurisdiction can be cured. The Tribunal was, therefore, justified in directing the Income-tax Officer to pass a fresh order in accordance with law. " In the case of Sardarilal Bhasin [1989] 179 ITR 307 (MP), it was held : " The clause 'No order imposing a penalty under this Chapter shall be passed' occurring in section 275 of the Income-tax Act, 1961, is attracted only to the initial penalty order and not to the penalty order passed after the case is remanded by the appellate authority. This position is not affected by the amendments made in section 275 by the Taxation Laws (Amendment) Act, 1970, or the Taxation Laws (Amendment) Act, 1975. " Nothing substantial could be urged before us to take a different view in the matter. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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