2005 (7) TMI 666 - HC - Income Tax

Summary

Issues:
1. Whether the Tribunal was justified in deleting the penalty under section 271(1)(c) due to the finally assessed income being a loss?

Analysis:
The High Court of Bombay, consisting of Judges R. S. Radhakrishnan & J.H. Bhatia, heard the appeal with Dr. P. Daniel and Mr. G. Hariharan representing the Appellant. The substantial question of law raised was whether the Tribunal's deletion of the penalty under section 271(1)(c) was justified given that the finally assessed income resulted in a loss. The learned counsel, Dr. Daniel, acknowledged that the Supreme Court had already addressed this issue in Commissioner of Income Tax Vs. Prithipal Singh and Co. 249 ITR 670. Dr. Daniel confirmed that the question had been answered by the Supreme Court, leading to the conclusion that the Tribunal was indeed justified in deleting the penalty. Consequently, the question was resolved against the Revenue and in favor of the Respondent, resulting in the disposal of the appeal accordingly.