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Penalty under section 271(1)(a) for delayed filing of return. Analysis: The judgment involves the aggrieved assessee challenging the penalty imposed under section 271(1)(a) for the delayed filing of the return. The assessee, a registered firm, filed the return for the assessment year 1977-78 after the due date, leading to penalty proceedings initiated by the Income Tax Officer (ITO). The ITO, after assessing the income, levied a penalty on the assessee for failing to file the return without reasonable cause. The assessee contended that the delay was due to the illness of a partner, for which an extension application in Form No. 6 had been filed. However, the ld. AAC upheld the penalty, noting that the grounds of continuous illness were not raised before the ITO and that evidence of filing Form No. 6 was not submitted timely. The Appellate Tribunal considered the submissions of both parties and found that the assessee had indeed filed an extension application before the due date of filing the return, as evidenced by a photostat copy submitted before the ld. AAC. The Tribunal criticized the ITO for not adequately considering this evidence and for not conducting proper inquiries into the reasons for the delay. The Tribunal also noted that the partner's illness, as supported by an affidavit and the Form No. 6, was a valid reason for the delay. Consequently, the Tribunal set aside the ld. AAC's order and remanded the matter back to him for a fresh decision. The ld. AAC was instructed to review the extension application, the affidavit, and to assess whether there was a reasonable cause for the delay, providing an opportunity for both parties to be heard and possibly seeking a report from the ITO. In conclusion, the Tribunal allowed the assessee's appeal, emphasizing the importance of considering all relevant evidence and providing a fair opportunity for the assessee to present their case. The judgment highlights the necessity for tax authorities to thoroughly investigate the reasons behind delays in compliance before imposing penalties under the Income Tax Act.
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