1979 (8) TMI 97 - AT - Income Tax

Summary

Issues:
1. Penalty imposition for delayed filing of income tax returns for the assessment years 1971-72 and 1972-73.
2. Compliance with penalty notices and explanations provided by the assessee.
3. Justification for penalty deletion by the Appellate Authority.

Analysis:
1. The appeals were filed by the Revenue against the orders of the AAC for the assessment years 1971-72 and 1972-73 due to delayed filing of income tax returns. The penalty proceedings were initiated by the ITO for the delay in filing the returns, leading to the imposition of penalties of Rs. 3,798 and Rs. 7,296 for the respective years.

2. In response to the penalty notices, the assessee provided explanations and filed necessary documents. The AAC, upon review, found that the penalties were unjustified as the assessee had complied with the show cause notices and submitted explanations in a timely manner. The AAC, therefore, deleted the penalties based on the lack of reasonable opportunity given to the assessee.

3. The Departmental Representative argued that the penalties should not have been deleted as the assessment was completed, and penalty notices were issued in conjunction with the assessments. However, the representatives for the assessee contended that the explanations were indeed filed in response to the notices issued by the ITO, even if there were discrepancies in the assessment years mentioned.

4. The ITAT upheld the AAC's decision to delete the penalties, emphasizing that the assessee had provided explanations in compliance with the notices served. The ITAT concluded that the penalties were unjustly imposed without considering the submissions made by the assessee, thereby justifying the deletion of penalties for both assessment years. Consequently, both Departmental appeals were dismissed.