COMMISSIONER OF INCOME TAX Vs. MEERA CHATTERJEE

JUDGEMENT

(1.) PASSED by the Tribunal, Delhi Bench 'G' in ITA No. 2704/Del/2005 relevant for the asst. yr. 2001 -02.

(2.) BY the impugned order, under appeal, the Tribunal allowed the appeal ITA No. 885/2007 p. 1/5 filed by the assessee challenging the levy of penalty under s. 271(1)(c) of the Act. The penalty was set aside by the Tribunal on the ground that the AO had not recorded any satisfaction in the assessment order regarding the concealment of income or for furnishing inaccurate particulars by the assessee.

(3.) MS . Prem Lata Bansal, learned senior standing counsel for the Revenue submits that in CIT vs. Ram Commercial Enterprises Ltd. (2001) 167 CTR (Del) 321 : (2000) 246 ITR 568 (Del) this Court has taken the view that if the AO does not record his satisfaction in the assessment order that penalty proceedings should be initiated against the assessee the subsequent order levying penalty would be bad in law. However, she says that another Bench of this Court has in CIT vs. Indus Valley Promoters Ltd. (2006) 155 Taxman 223 (Del) referred the following substantial question of law to a larger Bench which according to the referring Bench was not considered in Ram Commercial Enterprises Ltd. : "Whether satisfaction of the officer initiating the proceedings under s. 271 of the IT Act can be said to have been recorded even in cases where satisfaction is not recorded in specific terms but is otherwise discernible from order passed by the authority - She accordingly submits that this Court should await the decision of the larger Bench. It may be noted that this decision 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).