9911796707
TMI Blog1989 (6) TMI 88X X X X Extracts X X X X X X X X Extracts X X X X ..... aterial gathered by the assessing officer for the purpose of levy of penalty and quantum thereof can better be appreciated on reading the whole penalty order passed by the Inspecting Assistant Commissioner (Assessment) and, therefore, the same is reproduced :-- "M/s. Jhallani and Co. filed an estimate in form No. 29 for assessment year 1983-84 on10-6-1982, estimating the income at Rs. 10,000 and tax payable according to this income at Nil. The assessee filed the return on18-4-1984showing total income of Rs. 12,70,740. The assessment in this case was completed vide order dated31-12-1984at total income of Rs. 15,37,923. During the course of the assessment proceedings it was noticed that the assessee had filed wrong estimate and the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... register. It was confirmed that such a register is maintained vide order-sheet entry dated6-12-1984. In view of this and in view of the fact that previous year of the assessee ended on 30-6-1982 whereas the estimate has been filed on 10-6-1982 i.e. within 20 days of the close of the year, the assessee could very easily have estimated the amount of commission receivable for the previous year corresponding to assessment year 1983-84. In earlier years the assessee had taken the plea that the correct estimate of income could not be made because the rates of commission were not finalised by Company Law Board and there was a dispute on these points. However, even this factor is absent for assessment year 1983-84. Moreover, the assessee has chosen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... N.N. Subramania Iyer v. Union of India [1974] 97 ITR 228 (Ker.) in support of the contention that since the penalty notice was invalid, the proceedings initiated were illegal. This case was distinguished by the Inspecting Assistant Commissioner on the basis that the said case dealt with levy of penalty under section 18(1) of the Wealth-tax Act and it was not clear from the judgment as to whether specific reasons and details were given in the wealth-tax assessment order for initiating penalty proceedings and, therefore, the Hon'ble High Court had quashed the penalty proceedings in the absence of any specific remarks in the order. Besides unlike the provisions under the wealth-tax where the penalty is leviable for unrelated defaults, i.e., d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revised estimate came down to less than 25 per cent and, therefore, it could not be said that estimate filed in December, 1982 was false. Hence the penalty was cancelled. 5.1 It appears from the material placed before us that the assessee had also agitated on the ground of quantum of levy of penalty praying that penalty should be reduced to 10 per cent, i.e., the minimum imposable. This is clear from the stand taken before the CIT (Appeals) as also from the letters written in writing. Somehow or the other the CIT (Appeals) has not dealt with this aspect. 6. At the time of hearing before us the Departmental Representative supported the order passed by the Inspecting Assistant Commissioner (Assessment). It was emphasised that the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in any case, the penalty should have been restricted to minimum 10 per cent considering the past history of the case. 8. The contention of the assessee that once the revised estimate was filed, the earlier estimate became non-est and, therefore, penalty cannot be levied with reference to earlier estimate, is contrary to provisions of the statute. Section 273(a) and (aa), relevant for the purpose of the controversy, read as under :-- "(2) If the Income-tax Officer, in the course of any proceedings in connection with the regular assessment for the assessment year commencing on the 1st day of April 1, 1970, or any subsequent, assessment year, is satisfied that any assessee-- (a) has furnished under sub-section (1) or sub-section (2) or s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was never on the record of the Department and, therefore, even the satisfaction recorded for the purpose of initiation of penalty proceedings was with regard to the estimate filed in the month of June, 1982. Since the penalty could be levied for the false estimate filed earlier, the finding of the CIT (Appeals) that if revised estimate is taken into consideration the difference between the assessed tax, etc. came down with the permissible limit is irrelevant and not germane to the issue raised by the Inspecting Assistant Commissioner (Assessment). The CIT (Appeals) has misdirected himself in appreciating the case made out by the Inspecting Assistant Commissioner (Assessment). We, therefore, set aside his order and restore that passed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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