Penalty for tax default: assessing officer may impose capped penalties with hearing and refund if tax is reduced. When an assessee defaults in payment of tax, the Assessing Officer may direct a penalty in addition to arrears and interest, with further penalties for continuing default, but the total penalty cannot exceed the tax in arrears; the assessee must be given a reasonable opportunity of being heard and, if the default is shown to be for good and sufficient reasons, no penalty shall be levied; prior payment of tax does not by itself remove penalty liability; if a final order wholly reduces the tax, the penalty shall be cancelled and refunded.