Revisional order directing initiation of penalty u/s271E without Assessing Officer's recorded satisfaction set aside on appeal

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Full Text of the Document

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....Issue: Whether a Revisional order under section 263 can direct initiation of penalty under section 271E absent the Assessing Officer's satisfaction in the assessment order. Reasoning: Relying on the Supreme Court principle that initiation/levy of penalty under s.271E requires satisfaction recorded in the assessment, the Revisional Authority erred in treating penalty initiation as independent of AO's satisfaction and in distinguishing earlier High Court precedent. Outcome: The section 263 order directing initiation of penalty under s.271E was unsustainable and is set aside; appeal allowed. - ITAT....