1992 (6) TMI 96 - AT - Income Tax

Summary

Issues:
- Penalty imposed under section 271(1)(a) of the Income-tax Act, 1961 for late filing of the return.
- Applicability of the immunity from penalty under the amnesty scheme.
- Interpretation of circulars issued by the CBDT in connection with the amnesty scheme.

Detailed Analysis:
1. The appeal before the Appellate Tribunal ITAT Pune was against the penalty imposed by the ITO under section 271(1)(a) of the Income-tax Act, 1961 for late filing of the return. The CIT (Appeals) had confirmed the penalty, stating that there was no reasonable cause for the delay in filing the return.

2. The assessee, a registered firm dealing in soaps and detergent products, filed the return for the assessment year 1983-84 on 27-9-1985, after a delay of 26 months. The ITO initiated penalty proceedings due to the late filing, despite the assessee's plea that the return was filed voluntarily and under the voluntary disclosure scheme.

3. The CIT (Appeals) upheld the penalty, noting that the return was not specifically marked as filed under the amnesty scheme. He referenced Circular No. 432 dated 15-11-1985, stating that immunity applied if returns were filed voluntarily and in good faith between 15-11-1985 and 31-3-1986. The CIT (Appeals) found no reasonable cause for the delay and continued the penalty.

4. During the hearing, the assessee's counsel argued that the case fell under the amnesty scheme, citing Circular No. 432 and a revisional order waiving interest under section 139(8) for the same assessment year. The counsel contended that the conditions for immunity were met and urged that the penalty should be cancelled.

5. The Tribunal analyzed various circulars issued by the CBDT related to the amnesty scheme, including Circular No. 453 dated 4-4-1986, which extended the benefit of amnesty circulars till 30-9-1986 for cases disclosing income for assessment year 1986-87 or earlier. The Tribunal concluded that the assessee fulfilled the conditions specified in the circulars and orders, making them eligible for immunity.

6. The Tribunal noted that the CIT had waived interest under section 139(8) for the same delay in filing the return, indicating substantial compliance with the eligibility requirements for immunity under the amnesty scheme. The Tribunal held that the assessee was entitled to the benefit of immunity, and thus, set aside the penalty imposed by the ITO.

7. Consequently, the Tribunal allowed the appeal, cancelling the penalty and directing the ITO to refund the penalty amount if already paid by the assessee.