1992 (9) TMI 174 - AT - Income Tax

Amnesty Scheme, Assessing Officer, Bona Fide, Delay In Filing Return, Late Filing, Penalty Proceedings, Reasonable Cause, Show-cause Notice

Summary

Issues:
1. Penalty under section 271(1)(a) for belated filing of returns for multiple assessment years.
2. Penalty under section 273(2)(b) for failure to file an estimate of advance tax for a specific assessment year.

Detailed Analysis:
Issue 1: Penalty under section 271(1)(a) for belated filing of returns for multiple assessment years.
The appeals before the Appellate Tribunal ITAT Pune pertained to the levy of penalties under section 271(1)(a) of the Income-tax Act, 1961 for the belated filing of returns for the assessment years 1974-75, 1977-78, 1978-79, 1979-80, 1980-81, and 1981-82. The assessee, an individual, filed the returns voluntarily beyond the specified time limit under section 139(1) of the Act. The Assessing Officer initiated penalty proceedings, and despite the assessee's explanations, penalties were imposed as the Assessing Officer deemed the reasons for delay unsatisfactory, citing ignorance of the law as no excuse. The Dy. CIT (Appeals) confirmed the penalties, stating that no reasonable cause was shown by the assessee for the delayed filings. However, the assessee argued that as the returns were voluntarily filed, no penalties should be levied. The Tribunal considered various circulars issued by the CBDT, especially Circular No. 453 dated 4-4-1986, and extended the benefit of the Amnesty Scheme to the assessee, as the returns were filed during the period in which the Amnesty Scheme was in force. The Tribunal concluded that the penalties were not justified, setting aside the orders of the Dy. CIT (Appeals) and canceling the penalties imposed under section 271(1)(a) for the mentioned years.

Issue 2: Penalty under section 273(2)(b) for failure to file an estimate of advance tax for a specific assessment year.
For the assessment year 1981-82, the Assessing Officer also levied a penalty under section 273(2)(b) for the failure of the assessee to file an estimate of advance tax as required under section 209A of the Income-tax Act, 1961. The assessee offered similar explanations as in the case of late filing of returns. The Dy. CIT (Appeals) confirmed this penalty as well. However, the Tribunal found that the plea of reasonable cause taken by the assessee for the delay in filing returns also applied to the penalty under section 273(2)(b). The Tribunal concluded that there was a reasonable cause for the delay in filing returns and failure to furnish the estimate of advance tax, leading to the cancellation of the penalties imposed under section 273(2)(b) for the assessment year 1981-82.

In conclusion, the Tribunal allowed the appeals, canceling all penalties imposed under section 271(1)(a) for the mentioned years and under section 273(2)(b) for the assessment year 1981-82.