Tax Penalty Proceedings Require Contemporaneous Satisfaction During Assessment, Cannot Be Retrospectively Justified or Reconstructed

HC held that penalty proceedings initiated under two sections simultaneously are valid, but satisfaction must be recorded during assessment proceedings. The AO cannot record reasons for penalty after proceedings conclude. The tribunal's order quashing the revisional authority's directive was upheld, effectively ruling against the revenue. The core legal principle emphasizes that procedural satisfaction for imposing penalties must be contemporaneous with assessment proceedings, not retrospectively constructed. The decision reinforces strict procedural compliance in tax penalty impositions, ensuring that administrative discretion is exercised within prescribed temporal boundaries. .....

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