Advance tax notice service not proved, so penalty for failure to revise estimate could not be sustained.

Penalty under section 273(c) could not be sustained where the Revenue failed to prove due service of the advance tax notice under section 210. Mere despatch of the notice by registered post, without acknowledgement or other proof of delivery, was insufficient; the burden to establish service lay on the Revenue. Because valid service was not proved, the legal basis for requiring a revised advance tax estimate and for imposing penalty did not arise, and cancellation of the penalty was justified.

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Issues: Whether penalty under section 273(c) of the Income-tax Act, 1961 could be sustained when service of the advance tax notice under section 210 was not proved.

Analysis: The assessee denied service of the notice from the outset. The record showed only despatch of the notice by registered post and no acknowledgement or other proof of delivery to the assessee. In these circumstances, the burden lay on the Revenue to establish due service of the notice. Since service was not proved, the legal basis for requiring a revised estimate of advance tax and for invoking the penalty provision did not arise.

Conclusion: The notice under section 210 was not proved to have been duly served, and the penalty under section 273(c) could not be sustained; the cancellation of the penalty was therefore justified.

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