PENALTY UNDER SECTION 127-JURISDICTION & SUSTAINABILITY

[Sadanand Bulbule]

Dear experts

Power to impose penalty in certain cases.

127. Where the proper officer is of the view that a person is liable to a penalty and the same is not covered under any proceedings under section 62 or section 63 or section 64 or section 73 or section 74 or section 74A or section 129 or section 130, he may issue an order levying such penalty after giving a reasonable opportunity of being heard to such person.

Section122 covers categorical offences and the amount of penalty is fixed for each such offence. That being the legal position, can penalty still be levied under Section 127 for the offences covered by Section 122? Does it not amount to by-passing the provisions of Section 122 which has clear-cut nature of offences? Does such penalty sustainable?

Plz clarify in detail.

AI Summary

Residuary penalty power cannot substitute for specific statutory penalties and must be exercised proportionately with procedural fairness.
Section 127 operates as a residuary penal provision permitting penalty where no specific penalty is prescribed elsewhere; it cannot be used to bypass specific penal provisions. Any penalty under this provision must be imposed by a reasoned order after hearing, be proportionate to the contravention, and conform to principles of natural justice and the general disciplinary norms governing penalties, enabling taxpayers to challenge arbitrary or excessive levies.