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Issues:
1. Penalty under section 273(c) for non-filing of revised income estimate. 2. Penalty under section 140A(3) for non-payment of tax. Analysis: 1. The first issue pertains to the penalty imposed under section 273(c) for the non-filing of a revised income estimate. The Income Tax Officer (ITO) imposed a penalty on the assessee for not filing the revised estimate of income as required under section 212(3) of the Act, despite paying advance tax demanded by the ITO. The assessee argued that the new provision, section 212(3A), was not fully understood, leading to non-compliance. The Appellate Assistant Commissioner (AAC) upheld the penalty, stating that ignorance of the law is not an excuse. However, the Appellate Tribunal noted that the assessee's non-compliance was not deliberate, considering the complexity of the new provision and the short time since its introduction. Citing previous judgments, the Tribunal ruled that the penalty was unjustified, as the assessee had a reasonable cause for non-compliance due to lack of understanding of the new provision. Consequently, the penalty under section 273(c) was canceled. 2. The second issue concerns the penalty imposed under section 140A(3) for non-payment of tax. The ITO levied a penalty on the assessee for failing to pay the tax amount as per the returned income, disregarding the pending refund due to the assessee. The AAC confirmed the penalty, emphasizing the outstanding tax amount. In the appeal before the Tribunal, the assessee argued that section 140A(3) had been held ultra vires by the Madras High Court and requested a reduction in the penalty amount based on the pending refund. The Tribunal disagreed with the constitutional challenge to the provision and focused on the merits of the case. It noted the unadjusted refund amount and reduced the penalty imposed by the lower authorities, considering it excessive. Ultimately, the Tribunal allowed one appeal and partially allowed the other, reducing the penalty under section 140A(3) to a more reasonable amount of Rs. 1,500. In conclusion, the Tribunal's judgments in both issues highlight the importance of understanding legal provisions and circumstances surrounding non-compliance when imposing penalties under the Income Tax Act.
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