|DATE:||(Date of pronouncement)|
|DATE:||December 10, 2008 (Date of publication)|
penalty proceedings without recording satisfaction
(1) The judgement of the Division Bench in CIT v. Ram Commercial Enterprises Ltd. (2000) 246 ITR 568 (Delhi) holding that penalty under Section 271(1)(c) of the Act cannot be levied where the authority initiating the penalty proceedings had not recorded its satisfaction regarding concealment of income or furnishing of inaccurate particulars thereof by the assessee is approved.
(2) This position applies till the insertion of sub-section 1B to s. 271 by the Finance Act, 2008 w.r.e.f 1.4.1989 which creates a fiction by which satisfaction of the assessing officer is deemed to have been recorded in cases where an addition or disallowance is made by the assessing officer and a direction for initiation of penalty proceedings is issued.