1983 (9) TMI 178

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....e orders of Sri K.V. Krishnan, ITO Co. Cir. II (4), Madras. We are disposing of these appeals on consolidating them together and thereby passing a consolidated order for the sake of convenience, since these appeals are arising out of the consolidated order supra. Moreover the contentions and submission of the parties are also common. The relevant facts in brief are that the ITO imposed penalties u....

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....e authority is having effect on the quantum of appeal for asst. yr. 1977-78, which will at the most lead to effect on the quantum of penalties for the year under consideration. Thus the AAC has misconceived the order of the Tribunal in the asst. yr. 1977-78 resulting in cancellation of the impugned penalties on the ground that the assessment for the year under consideration is to be remade and the....

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....he penalty proceedings are merely channel arising from such source. Therefore, if an assessment order is quashed or set aside, then natural consequence is that the source is closed and therefore, the channel is also closed. Accordingly we hold that if an assessment order in which the penalty proceedings are initiated is cancelled, quashed or set aside, then the penalty proceedings initiated in suc....

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....ed an error in law and facts in vacating or quashing the impugned penalties which is based upon misconceiving and misreading of the order of the Tribunal. Accordingly we accept the contention of the ld. Departmental representative and reject that of the ld. Counsel for the assessee, holding further that the ITO should compute the quantum of penalties is in accordance with the order to be made in g....