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Issues involved:
The issues involved in this case are whether the Tribunal was justified in deleting the penalty under section 271(1)(c) for an inadvertent mistake by the assessee, and whether the Tribunal was justified in camouflaging concealment by inadvertent and bona fide mistake. Issue 1 - Penalty under section 271(1)(c): The Commissioner of Income-tax sought a direction to the Income-tax Appellate Tribunal to refer questions of law regarding the deletion of penalty under section 271(1)(c). The court noted that penalty imposition is a quasi-criminal proceeding and should not be imposed unless the party acted deliberately against the law or was guilty of contumacious conduct. Referring to the Hindustan Steel Ltd. v. State of Orissa case, the court emphasized that penalty imposition should be a matter of discretion exercised judicially considering all relevant circumstances. The Supreme Court held that if a breach stems from a bona fide belief or a technical violation, no penalty should be imposed. In this case, the Commissioner found the mistake to be inadvertent and bona fide, leading to no concealment by the assessee. The Tribunal upheld this finding, stating it as a question of fact not referable for opinion under section 256 of the Act. Issue 2 - Camouflaging concealment by mistake: Regarding the second question raised, the court noted that it did not arise from the Tribunal's order, as acknowledged by the Revenue's counsel. The court found this question not referable as well, stating that the answer to the first question was obvious. The court ultimately rejected the application, emphasizing that the Tribunal's decision was based on an uncontroverted finding of fact and therefore justified in refusing to refer the matter. No costs were awarded in the final decision.
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