COMMISSIONER OF INCOME TAX DELHI IV vs. H.B.LEASINGH & FINANCE CO. LTD.

IN THE HIGH COURT OF DELHI AT NEW DELHI . 18.12.2008 .

Present: Ms Prem Lata Bansal, Mr Mohan Prasad Gupta, Mr Sanjeev Rajpal and Ms Anshul Sharma, Advocates for the Appellant.

Mr Santosh K. Aggarwal, Advocate for the Respondent . + ITA 1388/2008 .

This appeal is directed against the order dated 11.01.2008 passed by the Income Tax Appellate Tribunal in ITA No 4771/Del/05 relating to the assessment year 1994-95. The Tribunal has decided in favour of the assessee following the decision of this Court in the case of CIT vs Ram Commercial Enterprises Ltd: 246 ITR 568 (Del.) on the ground that the satisfaction was not recorded in the assessment order for initiating penalty proceedings under Section 271(1)(c) of the Income Tax Act, 1961. The Tribunal, however, has not expressed any opinion on merits.

In view of the insertion of sub-Section (1B) in Section 271 of the said Act by virtue of the Finance Act, 2008 w.e.f. 1.4.1989, the matter would require to be remanded back to the Tribunal for a decision on merits. The impugned order is set aside. The matter is remitted to the Tribunal for a decision on merits.

The appeal stands disposed of. . BADAR DURREZ AHMED, J . . RAJIV SHAKDHER, J December 18, 2008/kk . . . 3