Written satisfaction before penalty notice is not mandatory where the statute does not expressly require prior recording.

For penalty proceedings for furnishing a false advance tax estimate, the Assessing Officer must have satisfaction to initiate action, but the Income-tax Act does not require that satisfaction to be recorded in writing before notice is issued. The reasoning turned on statutory interpretation: where the legislature intended a prior written recording of reasons or satisfaction, it said so expressly, as in section 148(2); section 273 contains no equivalent condition. The requirement to record satisfaction in writing was therefore answered in the negative, against the assessee.

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Issues: Whether the Assessing Officer is required to record his satisfaction in writing before initiating penalty proceedings under section 273(2)(a) of the Income-tax Act, 1961 for furnishing a false estimate of advance tax.

Analysis: The statutory scheme was treated as significant: where the legislature intended prior recording of reasons or satisfaction, it expressly said so, as in section 148(2) of the Income-tax Act, 1961. Section 273 contains no similar requirement for recording reasons or satisfaction in writing before issuing notice. The Assessing Officer must have the requisite satisfaction for initiating penalty, but the statute does not mandate that such satisfaction be recorded in writing before commencement of proceedings.

Conclusion: The requirement to record satisfaction in writing before initiating penalty proceedings under section 273(2)(a) was answered in the negative and against the assessee. The appeal was dismissed.

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