ARIJIT PASAYAT,cj. , (ORAL) ( 1 ) AT the instance of Revenue, under Section 256 (1) of the Income-tax Act, 1961 (for short the Act) the Income-tax Appellate Tribunal, Delhi Bench-B (for short thetribunal) has referred following question for opinion of this Court: "whether on the facts and in the circumstances of the case the Tribunal wascorrect in deleting the penalty of Rs. 10,000. 00 levied by the IAC under Section271 (1) (c)?" ( 2 ) FACTUAL position in a nutshell is as follows: For the assessment year 1973-74,assessee filed its return of income on 16/08/1973 disclosing income ofrs. 19,887. 00. By a revised return, filed on 29/09/1976 it was shown atrs. 47,834. 00 which included Rs. 10,000. 00 on account of shares allotted otherwise thanfor cash in Doburg Lager Breweries Private Limited. Assessing Officer treated thesum of Rs. 10,000. 00 as income from undisclosed sources and initiated penaltyproceedings. The Inspecting Assistant Commissioner (IAC for short) levied penaltyof Rs. 10,000. 00 under Section 271 (1) (c) of the Act by order dated 29/08/1978. Same was challenged before Tribunal by assessee. Tribunal held that the IAC had nojurisdiction to impose the penalty, by its order dated 28th Jan. 1981. no decision wasrendered on other grounds. Subsequently, an application was filed by the assessee,which was treated as miscellaneous petition, with the request for taking up the caseon merits also. By order dated 27/02/1982 the Tribunal disposed of thatapplication and decided the other grounds in favour of the assessee. ( 3 ) IN view of the factual position highlighted above and decision of the Apex Courtin Commissioner of Income-tax Vs. Dhadi Sahu (1993) 199 ITR 610, the Tribunalwas right in holding that the IAC did not have jurisdiction to impose penalty. Thatbeing the position there is no necessity for deciding the question as to whether onmerits also the assessee was entitled to any relief. The question is accordinglyanswered in the affirmative i. e. in favour of the assessee and against the Revenue.