1981 (8) TMI 113

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....,185 for under valuation of the closing stock and the other for Rs. 10,300 for the alleged theft of his amount by the driver. While making the assessment the ITO started penalty proceedings under s. 271(1)(c) and asked the assessee to show cause. There is no clear directions in the assessment order or in the notice to show cause under s. 274 as to whether penalty proceedings were started for one o....

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....r there was any loss. The assessment was, therefore, set aside. The matter was again enquired into and the addition was sustained by an order dt.29th Jan., 1979by the ITO who held that there was no theft. The appeals by the assessee to the AAC and the Tribunal were dismissed. The ITO, then started penalty proceedings against the assessee under s. 271(1)(c) in respect of the disallowance of loss of....

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....inst the addition of Rs. 5,185 in respect of which the first penalty order has been passed. The AAC held that while passing the first penalty order the ITO had obviously considered that the addition of Rs. 10,300 did not justify levy of penalty and the ITO could not legally change his opinion and start penalty proceedings afresh in respect of this amount unless there was a change in the original a....

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....ing of inaccurate particulars. He, therefore, cancelled the penalty. 4. The Department is aggrieved and has come up in appeal. I have heard the ld. Deptl. Rep. and the counsel for the assessee. In my opinion, the order of the AAC is unassailable on facts and in law. The ITO cannot start the penalty proceedings afresh on the same material which was before him when he started the first penalty pr....