Section 271E penalty cannot survive if underlying assessment order annulled: SC

CIT Vs Jai Laxmi Rice Mills Ambala City (Supreme Court of India) The case of CIT vs. Jai Laxmi Rice Mills before the Supreme Court of India revolved around whether penalty proceedings under Section 271E of the Income Tax Act are independent of assessment proceedings. The issue arose for the assessment years 1991-1992 and 1992-1993 when the tax authorities, based on CIB information, found that the assessee was engaged in large-scale wheat trading but had not filed income tax returns. As a result, the Assessing Officer passed an order on February 26, 1996, assessing a taxable income of ₹18,34,...