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Issues Involved:
1. Whether the Tribunal fees on an appeal against the order of penalty levied under s. 271(1)(c) is governed by cl. (d) of s. 253(6) or cls. (a) to (c) of s. 253(6) of the IT Act. Detailed Analysis: Issue 1: Tribunal Fees on Appeal Against Penalty Under s. 271(1)(c) Background and Facts: The assessee filed appeals against the orders of the CIT(A) sustaining penalties under s. 271(1)(c) for the assessment years 1993-94 and 1994-95. The penalties were Rs. 25,000 and Rs. 28,000 respectively. The assessee initially deposited a Tribunal fee of Rs. 10,000 for each appeal but later requested a refund of Rs. 9,500, arguing that only Rs. 500 was required as per cl. (d) of s. 253(6). Arguments by the Assessee: The assessee's counsel argued that penalties under s. 271(1)(c) should fall under cl. (d) of s. 253(6) as they are not directly related to the assessed income. He contended that cls. (a), (b), and (c) pertain to appeals concerning assessed income, while cl. (d) covers other matters, including penalties for concealment of income. The counsel cited decisions from various cases to support his argument. Arguments by the Departmental Representative: The Departmental Representative argued that the fees should be governed by cls. (a) to (c) as the penalty order is directly connected with the assessment order. He emphasized that the penalty under s. 271(1)(c) is intrinsically linked to the assessed income, and if the assessment is set aside, the penalty is also affected. Tribunal's Analysis: The Tribunal examined the provisions of s. 253(6) and noted the different terminologies used in the clauses. It concluded that cls. (a), (b), and (c) apply where the appeal relates to the assessed income, while cl. (d) applies to other matters. The Tribunal emphasized the distinction between "assessed income" and "concealed income," noting that penalty proceedings are separate from assessment proceedings and involve different considerations. Key Judicial Precedents: - CIT vs. S.V. Angidi Chettiar (1962) 44 ITR 739 (SC) - D.M. Manasvi vs. CIT (1972) 86 ITR 557 (SC) - CIT vs. Ram Commercial Enterprises Ltd. (2000) 246 ITR 568 (Del) - CIT vs. Dwarka Prasad Subhash Chandra (1974) 94 ITR 154 (All) - Banaras Textorium vs. CIT (1988) 169 ITR 782 (All) - CIT vs. Metal Products of India (1984) 150 ITR 714 (P&H) These cases highlighted that penalty proceedings are distinct from assessment proceedings and that penalties are imposed on "concealed income" rather than "assessed income." Conclusion: The Tribunal concluded that the subject matter of an appeal relating to a penalty under s. 271(1)(c) is different from that of assessed income. Therefore, the Tribunal fee for such appeals should be governed by cl. (d) of s. 253(6), which specifies a fee of Rs. 500. Dissenting Opinion: One member disagreed, arguing that penalty under s. 271(1)(c) is inherently connected to the assessed income and should fall under cls. (a) to (c). He emphasized that the appeal against such penalties is related to the assessed income and should be treated accordingly. Final Decision: The majority opinion held that the Tribunal fee for appeals against penalties under s. 271(1)(c) is governed by cl. (d) of s. 253(6), and the assessee should pay a fee of Rs. 500. The case was referred back to the regular Bench for deciding the grounds of appeal based on this finding.
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