COMMISSIONER OF INCOME TAX Vs. WISEC GLOBAL LTD.

JUDGEMENT

(1.) DELHI Bench 'H', New Delhi in ITA No. 161/Del/2006 relevant for the asst. yr. 1998 -99.

(2.) THE AO sought to initiate penalty proceedings under s. 271(1)(c) of the IT Act, 1961 ('Act') by his assessment order "Penalty proceedings under s. 271(1)(c) have been initiated separately. Assessed as above. Issue necessary forms." 32,98,708. The appeal against the said order filed by the assessee was allowed by the Commissioner of Income -tax (Appeals) ['CIT (A)'].

(3.) DISMISSING the appeal of the Revenue, the Tribunal followed the decision of this Court in CIT vs. Ram Commercial Enterprises Ltd. (2001) 167 CTR (Del) 321 : (2000) 246 ITR 568 (Del) and held that since there was no recording of satisfaction of the AO in the order of assessment that penalty proceedings must be initiated, the penalty proceedings are illegal. At the outset, it requires to be noted that the decision of this Court in Ram Commercial Enterprises Ltd. (supra) has been approved by the Supreme Court in Dilip N. Shroff vs. Jt. CIT (2007) 210 CTR (SC) 228 : (2007) 291 ITR 519 (SC) and T. Ashok Pai vs. CIT (2007) 210 CTR (SC) 259 : (2007) 292 ITR 11 (SC).