This is appeal filed by assessee against order of AAC upholding levy of penalty of Rs. 1,266 under s. 17(1)(a) of GT Act. In this case return of gift-tax was due to be filed on or before 30th June, 1970. doner, Smt. Lilabai Matkar, expired on 27th Dec., 1971 and, hence, return of gift tax was filed by Smt. Jijeebai Shinde, daughter and legal heir of deceased, on 16th May, 1972. GTO initiated penalty proceedings under s. 17(1)(a) of GT Act and imposed penalty of Rs. 1,266 on assessee. assessee went appeal and before AAC it was submitted that in this case gift-tax assessment order of notice of demand itself and had not been served on assessee and, hence, levy of penalty under s. 17(1)(a) is totally unjustified. It was further submitted that there was no justification for levy of penalty on legal representative of deceased. Both contentions of assessee were rejected by AAC and he uphold levy of penalty in this case. Aggrieved, assessee has come up in present appeal. Before us, ld. counsel for assessee submitted firstly that neither any copy of assessment order or form notice of demand has ever been served on legal representative of deceased and, hence, there was no valid initiation of penalty proceedings in this case. He submitted that since entire penalty proceedings were ab anitio void, levy of penalty itself was unjustified. In support of this contention, he placed reliance on decision of Calcutta High Court in 92 ITR 215 (sic) which was later on approved by Supreme Court in 140 ITR 477 (sic). Secondly, contention of ld. counsel is that in estate duty assessment of deceased, Smt. Lilabai Matkar, value of gift i.e. Rs. 60,000 made by deceased donor had already been included in principal estate of deceased as it was found to have been made within two years of her death. ld. counsel submitted that since amount of gift had already been included in estate duty assessment, no gift-tax is payable in respect of this gift in view of provisions of s. 6(1) of GT Act. third contention of ld. counsel before us is that no penalty can be imposed on legal representative of deceased under s. 17(1)(a) of GT Act for reason that in s. 19(3) of GT Act, s. 17 has not been mentioned and, accordingly, there is no liability on legal representative of deceased under s. 19 of GT Act for payment of any penalty under s. 17 of said Act. To support above contention, he has placed reliance on decision of Madhya Pradesh High Court in CIT vs. Abdul Majid (1983) 11 ITC 252 (MP). ld. representative of Department has not been able to rebut above contentions of ld. counsel. After hearing ld. representatives of parties and goind through record, we find considerable force in contentions of ld. counsel. For all three reasons advanced by ld. counsel, which have not been rebutted by ld. representative of Department, we are firmly of view that levy of penalty under s. 17(1)(a) of GT Act of Smt. Jijibai Shinde, legal representative of deceased, Smt. Lilabai Matkar, is totally unjustified and, accordingly, we cancel said penalty. In result, appeal is allowed. *** SMT. JIJEEBAI SHINDE v. GIFT TAX OFFICER