Section 271E(2) — the law in short
What the courts have decided on section 271E(2), in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.
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PCIT v JKD Capital & Finlease Ltd
High CourtHelps taxpayer
The assessing officer directed penalty under section 271E in my assessment order, but the Additional Commissioner only issued the show cause notice years later. Is that penalty time barred?
Yes. The Delhi High Court held that under section 275(1)(c) time runs from when the Assessing Officer initiated the action - here December 2007, in the assessment order - not from the Additional Commissioner's show cause notice issued five years later. The penalty order therefore had to be passed by 30 June 2008, the later of the two limits in the clause. An order of 20 March 2012 was out of time. The Court also held that penalty for breach of section 269T is independent of the quantum proceedings, so an appeal against the assessment does not extend time. Appeal dismissed.
Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.