2004 (5) TMI 21 - HC - Income Tax

Penalty of Rs. 5,000 under section 272A(1)(c) - assessee submitted that there was no deliberate attempt on his part not to respond to the summons under section 131(1) of the Act. No doubt, he had submitted an adjournment application for the second time on the ground that he had gone out of station on account of business tour. - we are inclined to allow the petition in so far as imposition of the penalty of Rs. 5,000 under section 272A(1)(c) of the Act is concerned.

Summary

Issues Involved:
Challenge to penalty imposed under section 272A(1)(c) of the Income-tax Act, 1961 for failure to respond to summons under section 131.

Detailed Analysis:

1. Penalty Imposed under Section 272A(1)(c):
The judgment revolves around the penalty imposed under section 272A(1)(c) of the Income-tax Act, 1961 on the assessee for failing to respond to a summons under section 131. The Deputy Director of Income-tax imposed a penalty of Rs. 5,000 after concluding that the assessee had no valid ground for seeking an adjournment and not appearing before the Assessing Officer. The assessee claimed that the failure to respond was not deliberate and was due to being on a business tour. The court considered the nature of the assessee's work and found justification for the absence on a business tour.

2. Justification for Absence on Business Tour:
The court analyzed the nature of the work performed by the assessee and the circumstances of being on a business tour. It acknowledged the difficulty in concluding that the assessee was unjustified in remaining outside Delhi due to business commitments. This assessment played a crucial role in determining the validity of the penalty imposed under section 272A(1)(c) of the Act.

3. Judgment and Relief Granted:
After considering the submissions and circumstances, the court decided to allow the petition in part. It quashed the penalty of Rs. 5,000 imposed under section 272A(1)(c) of the Act. The court found merit in the assessee's explanation for the failure to respond to the summons under section 131. The judgment highlighted the specific circumstances of the case and the absence of deliberate intent on the part of the assessee.

4. Disposition of the Writ Petition:
The court disposed of the writ petition by granting relief only in relation to the penalty imposed under section 272A(1)(c) of the Act. The other prayers made by the assessee were not pressed and were considered infructuous in light of the decision on the penalty issue. The judgment concluded by quashing annexure R1 and allowing the petition to the extent of setting aside the penalty, while disposing of the rest of the prayers accordingly.

In summary, the judgment focused on the justification for the assessee's absence on a business tour in the context of the penalty imposed under section 272A(1)(c) of the Income-tax Act, 1961. The court found merit in the explanation provided by the assessee and quashed the penalty based on the peculiar facts and circumstances of the case.