1999 (1) TMI 10 - HC - Income Tax

Summary

Issues:
- Interpretation of penalty provisions under section 9 of the Surtax Act, 1964.
- Justification for late filing of a return before completion of assessment.
- Applicability of penalty for late filing of return under section 9 of the Act.

Interpretation of Penalty Provisions:
The case revolved around the interpretation of penalty provisions under section 9 of the Surtax Act, 1964. The central question posed was whether a penalty for late filing of a return could be levied if the return was filed before the completion of assessment. The Act stipulates penalties for failure to furnish a return without reasonable cause, concealing profits, or providing inaccurate particulars. The court examined the specific language of the statute to determine the scope of penalties applicable in cases of belated filings.

Justification for Late Filing:
The assessee in this case filed the return beyond the prescribed deadline, citing a reasonable cause for the delay. The company contended that due to the disallowance of a provision, there was a change in the income declared in the return, justifying the delay in filing. The Assessing Officer initiated penalty proceedings under section 9(1) of the Act, leading to a dispute over the applicability of penalties for late filing under the given circumstances.

Applicability of Penalty for Late Filing:
The court analyzed the provisions of the Surtax Act, particularly section 5 regarding return filing deadlines and section 9 outlining penalties. It highlighted that the Act allowed for filing a return or revised return before the completion of assessment, without attracting penalties for late submission. The judges emphasized that the penalty provision under section 9 did not encompass penalties for delayed filings, unlike provisions in the Income-tax Act. Relying on precedents and legal principles, the court concluded that penalties under section 9 were applicable only for failure to file a return without reasonable cause, not for late submissions made before assessment completion.

In conclusion, the court affirmed that no penalty was leviable for the late filing of the return in this case, as the company submitted the return before the assessment was finalized. The decisions of the Commissioner of Income-tax (Appeals) and the Tribunal were upheld, emphasizing the distinction between penalties for failure to file a return and penalties for late filing under section 9 of the Surtax Act, 1964.