1985 (1) TMI 123 - AT - Income Tax

Summary

Issues:
Late filing of returns leading to penalty under section 271(1)(a) of the IT Act, 1961.

Detailed Analysis:

1. The case involved appeals against the order of the AAC, who partly allowed the appeals against the orders of the ITO for late filing of returns. The assessees were partners in the same firm and penalized for late filing of returns. The ITO initiated penalty proceedings under section 271(1)(a) of the IT Act, 1961, for late filing of returns.

2. The assessees contended that the delay in filing returns was due to a raid conducted by the Department in the firm in which they were partners, leading to the seizure of books of accounts. The ITO rejected their explanations and imposed penalties on the assessees.

3. The AAC observed that the assessees were prevented from filing returns due to the actions of the Department and that there was a delay of five months. The assessees appealed further, arguing that the delay was explained by circumstances beyond their control.

4. The assessees argued that the delay was justified as they were waiting for the release of the books of accounts of the firm. They also contended that the notices issued for imposing penalties were not valid and that the burden of proof for late filing of returns lies with the Revenue.

5. The Departmental Representative argued that the onus is on the assessee to explain each day of delay in filing returns, which the assessees failed to discharge.

6. The Tribunal held that the delay in filing returns was not adequately explained by the assessees. It was established that the assessees were partners in the firm that filed returns on a specific date, and the further delay in filing by the assessees was not justified. The Tribunal emphasized that the penalty is to be imposed for complete months of delay.

7. The Tribunal cited legal precedents to support its decision, emphasizing that the onus is on the assessee to prove sufficient cause for late filing of returns. The Tribunal also found the notices issued for imposing penalties to be valid and directed the ITO to compute the penalties in each case.

8. In conclusion, the appeals were partly allowed, and the Tribunal upheld the penalties imposed on the assessees for late filing of returns.