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Issues Involved:
1. Whether the delay in filing the return of income by the assessee was justified. 2. Whether the penalty under section 271(1)(a) of the Income-tax Act, 1961 was correctly levied by the ITO. 3. Whether the CIT(A) was correct in reducing the penalty period from 10 months to 2 months. 4. Whether the word "month" in section 271(1)(a) should be interpreted as a calendar month or a period of 30 days. Detailed Analysis: Issue 1: Justification for Delay in Filing Return The assessee was required to file her return for the Assessment Year 1982-83 by 30-6-1982 but filed it on 29-10-1983. The delay was attributed to the non-receipt of her share of profits from the firms where she was a partner. The ITO rejected this explanation as the assessee failed to produce a copy of the extension application in Form No. 6. However, the CIT(A) accepted the explanation, noting that the ITO had not responded to the extension application and condoned the delay up to 30th September 1982, relying on the Gujarat High Court decision in CIT v. Gordhanbhai Jethabhai [1983] 142 ITR 84. Issue 2: Penalty under Section 271(1)(a) The ITO initially levied a penalty of Rs. 13,410 for a 10-month delay. The CIT(A) reduced the penalty period to 2 months, accepting that the delay due to non-completion of firm's accounts constituted a reasonable cause, relying on the M.P. High Court decisions in CIT v. Dwarkadas Moolchand [1982] 134 ITR 392 and Kishandas Agarwal, 141 ITR (sic). Issue 3: Reduction of Penalty Period by CIT(A) The CIT(A) directed the ITO to levy a penalty for only 2 months instead of 10 months, as the latest firm return was filed on 3-8-1983. The revenue appealed against this reduction, while the assessee cross-objected, arguing that at most, a penalty for one month should be levied, citing decisions from the Madras, Calcutta, and Karnataka High Courts. Issue 4: Interpretation of "Month" in Section 271(1)(a) The word "month" in section 271(1)(a) has been construed differently by various High Courts. The Allahabad High Court in CIT v. Laxmi Rattan Cotton Mills Co. Ltd. [1974] 97 ITR 285 interpreted "month" as a period of 30 days, while the Madras High Court in CIT v. Kadri Mills Coimbatore Ltd. [1977] 106 ITR 846 and other High Courts interpreted it as a calendar month according to section 3(35) of the General Clauses Act, 1897. The Tribunal agreed with the latter interpretation, stating that "month" should mean a calendar month, not a period of 30 days. Conclusion: The Tribunal dismissed the revenue's appeal and allowed the assessee's cross-objection. It held that the delay up to 3rd August 1983 was satisfactorily explained, and the penalty should only be for one month, i.e., September 1983. The interpretation of "month" was aligned with the calendar month as per the General Clauses Act, 1897.
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