A. Raghuvir, C.J.:- The Reference in this case arises under the Income-tax Act, 1961. The assessed firm in the return for 1974-TS5 disclosed income of Rs. 26,000/-. The I. T. O. in his order enhanced the income to Rs. 1,40,860/- in that Rs. 1,14,000/-was determ­ined to be from other sources. Further the following outstanding Rs. 20,000/- in the name of Kashi Prasan Sah, Rs. 4000/-In the name of Mohanlal Jaichandlal, Rs. 14,000/- in the name of Tikomchand Jain and Rs, 40,000/- in the name of Punamchand Ratanlal, Rs. 60,000/- in the name of the firm Assam Metals, Rs. 1,24,000/- in the name of M/S. Assam Tubes, are not true therefore levied a "pro­tective penalty'' of Rs. 1, 14,000/-. The assessee unsuccessfully ther­eupon filed appeals before the C.I.T. and the Tribunal. Finally at the instance of the assessee the following question is referred for the opinion of this court : "Whether on the fact and in the circ­umstances of the case, the Tribunal was justified in maintaining the penalty of Rs. 1,15,000/- under section 271 (1) (c) of the Income Tax Act, 1961 imposed on protective basis" 2. The assessee in the two appeal it is seen assailed the noti­ces issued on September 5, 1977 and February 7, 1980 as they were defective. The former notice was as' sailed at it was not served on the assessee. The latter was not signed by the T.T.O. It is not clear from the statement of the case whether the former notice was ser­ved on the assessee. The other notice unsigned is placed before the court. The two contentions were not determined by the C.I.T. and by the Tribunal though in the two orders the contentions raised by the assessee are noted. The case in 136 ITR 330, Umashankar Mishra vs. C.I.T, of the Madhya Pradesh High Court and 62 ITR 109, B. R. Goyal vs. C.I.T. of Calcutta High Court dealt with simi­lar contentions and held that under section 282 notices have to be served as prescribed the Code of Civil Procedure Act 2 of 1900. In sub-clause (1) of Clause (1) of Order 5 of the Code every notice must be signed and served, Since the appellate authorities have failed to determine the facts therefore, we are put to the necessity of dealing with the legality of the issue in the question referred. 3. In sub-clause (1) of Clause (1) of Order 5 of the Code every notice must be signed and served, Since the appellate authorities have failed to determine the facts therefore, we are put to the necessity of dealing with the legality of the issue in the question referred. 3. The Calcutta High Court in 775 TTR 451, C.I.T. vs. Super Steel (Sales) Co. considered a like issue as in the instant case and held : "There can be a protective assessment but there cannot be any protective penalty.'' When a similar issue arose in 141 ITR 32, C.I.T. vs. Beharilal Pyarelal before the Punjab & Haryana High Court the revenue conceded that protective penalty in law cannot be levied. We arc in agreement with the conclusion in these two cases and cite acerb two cases decided by the Supreme Court of India. 4. The nature of the penalties under the Income Tax Act, 1961 was considered by the courts times out of number and in many cases it is sees the issue is raised by the revenue that penalties are in' the nature of Civil sanctions. When penalties are levied the revenge entranced that the assessee is not prosecuted. Wet enquiries are made proceedings do not partake the character1 of quasi-criminal proceedings. When penalties ate levied the con­tention was raised that the assessees are not sentenced Similar views were also expressed before the Parliament (see the debates on the budget after February 29, 1988 in Parliament). In a brochure by J. W. Pende. published in 1988 under the aegis of the Direc­torate of Income Tax numerous attempts made by the revenue are recounted in that brochure. Such attempts are made and reiterated in the' instant case on behalf of the revenue. The assessee however contends that in law there is nothing like protective penalty and seeks an answer in favour of the assessee. 5. Conceptually civil sanctions and penalties are different therefore cannot be grouped together. In penalty proceedings nor as that are observed are founded in Criminal law. The standard of proof expected is that of the standard required in criminal procee­dings. These coc-5pts are well entrenched in the decided cases and it may be too light in the day to retrieve them from the field of criminal law. In penalty proceedings nor as that are observed are founded in Criminal law. The standard of proof expected is that of the standard required in criminal procee­dings. These coc-5pts are well entrenched in the decided cases and it may be too light in the day to retrieve them from the field of criminal law. To start with we may look at the definition of penalties in Corpus Juries Seconded, Volume 70 page 387 which contains a com­prehensive definition of the word: "Penalty is an elastic term with many different shades of meaning. The term involves the idea of punishment, either corporal or pecuniary, or civil or criminal, although its meaning is generally confined to pecuniary punishment. In its broad sense it includes fines as well as other kinds of punishment Whether an exaction is a penalty is determined, not by the name or designation given it in the statute, but the intrinsic nature of the exaction and its character is not changed by the mode in which it is inflicted, whether by a civil action or a criminal prosecution ......'penalty' is also frequently used to denote an equivalent by way of damages for a civil wrong and is in this sense sometimes applied to stipulated damages for breach of private contracts, wholly independent of statute......". 6. What norms are observed while penalties are levied are discussed in the case of 83 1TR 26, Hindustan Steel Ltd. vs. State of Orissa. In that case the Supreme Court held for failure to carry out a statutory obligation ordinarily "penalty is not imposed unless the assessee is guilty of contumacious or dishonest conduct. Penalty is not responding rarely because it is lawful to do so". It is pointed out in that case if facts warrant penalties may not be imposed. Even if a minimum penalty is prescribed, penalty may not be imposed if "there is a technical or venial breach of the provisions of the Act or where the breach flows from a bona-fide belief that the offender is not liable to act in the manner prescribed by the statute." In another case AIR 1980 SC 1146 , Atmatharam Veera singhaish & Co. vs. I. T. Commissioner, A. P. penalty proceedings were characterized as quasi-criminal proceedings. The mere falsity to the explanation it was explained per se was not sufficient to impose penalty. vs. I. T. Commissioner, A. P. penalty proceedings were characterized as quasi-criminal proceedings. The mere falsity to the explanation it was explained per se was not sufficient to impose penalty. To .a like effect observations are found in the case of AIR 1972 SC 132 Commr. of Income Tax, Madras vs. Khoday Eswarsa and Sons (see para 19). In the case of AIR 1970 SC 778 , M/S. Jain Bros. vs. Union of India there is discussion as to when penalty proceeding's can be invoked. In that case a. notice on May 26, 1960 was served to submit return under the 1922 Act. The return was filed on November 18, 1961 and finally penalty was levied alter the 1961 Act came into force.1 The assessee complained of discrimination and what was required-in that case is apposite for the present discussion in the instant case. The argument was that in the 1961 Act penalty and prosecution both could be launched. In the repealed Aft prosecution was not contemplated. The approval of Inspecting Assistant Commissioner was contemplated in the repealed Act but not in the repealing Act. The repealed Act did not prescribe a minimum penalty as is found in the repealing Act. The repealed Act did not prescribe any lim­itation us is found in the 1961 Act. The Supreme Court explained that penalties are levied after assessments are completed and not before or never before. The complaint that penalty is left to the discretion of the officers was refuted therefore it was held that there was no violation of the equality principle. That case was followed in AIR 1986 SC 293 , Maya Rani vs. I. T. Commr., Delhi. A case which took a different view was overturned is referred' in the latter case. The above discussion shows penalties are levied after assessment orders and not before the assessment orders. The protective penalty thus we are of the view is conceptually antithetical and cannot be conceived in law. 7. The question referred for the aforesaid reasons is answered in the negative against the revenue and in favour of the assessee. No costs.