9911796707
TMI Blog1984 (2) TMI 175X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Rs. 3,660, respectively. Self-assessment tax was not paid till the assessments themselves were completed and the self-assessment tax got merged with the demand on regular assessment. It is the assessee's case that even this regular demand could not be paid and the assessee had to ask for time for payment of the same due to paucity of funds which is the ground pleaded for non-payment of self-assessment tax on the due dates. The ITO did not accept the explanation and levied the impugned penalties of Rs. 5,286 for the assessment year 1978-79 and Rs. 2,928 for the assessment year 1979-80. The first appellate authority confirmed the penalties. Hence, the second appeal. 3. The learned counsel for the assessee raised an initial objection that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITR 91 wherein it was pointed out that the ITO had discretion both as to whether to levy penalty or not to levy penalty as well as on the quantum of penalty. 4. The learned departmental representative, on the other hand, pointed out that even where self-assessment tax itself had been paid, the Madras High Court in the case of CIT v. Smt. Vijayanthimala [1977] 108 ITR 882 held that the fact of subsequent payment, though prior to the issue of notice, did not wipe out or efface the default and cannot protect the taxpayer from liability on such default. He claimed that the assessee's facts were worse because the regular demand of which the self-assessment tax payable was part, had admittedly not been paid even at the time of issue of the not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tal representative, the assessee's facts are worse than those encountered in the decision relied upon by him. We do not, therefore, find that there was any legal impediment for the ITO seeking to have a recourse to the penal provisions of section 140A. 6. As for merits, it would, at first sight, appear that the High Courts have taken conflicting views as to the adequacy of financial stringency as an explanation for avoiding penalty. But there is really no such conflict if one were to look into the facts of the cases. In the case of Sarvaraya Textiles Ltd., the assessee was a public limited company which had delayed the payment only by a month. The assessee also explained that it was unable to make the arrangement of such a large amount of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arguments of the revenue stated as under : " ...We would rather decide the matter arising in this case on the usual touchstone in tax references which we apply to cases where discretionary orders are passed by the Tribunal or where findings of fact are rendered by that body. In such cases, the Tribunal's decision is normally given due respect and finality, unless this Court finds that the finding had been come to on no evidence or unless the discretion had been exercised in a non-judicial way... " Hence, in all these three cases, the Tribunal's conclusion was upheld by the High Court as one on facts. The first two cases related to the companies which had made the payment after a short delay due to financial difficulties. In the last cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... true. 7. We would now proceed to consider the facts of the assessee's case. As pointed out by the learned departmental representative, the balance sheet does show cash balance far in excess of the tax payable on the day of closing of accounts. The assessee has not brought any material to show that the assessee was unable to make any provision out of such cash balance. Again, as pointed out by the learned departmental representative, there is no material to suggest that the capital had been blocked either in unrealisable debts or dead stock. The mere fact that 70 per cent of the capital is blocked in sundry debtors or closing stock does not lead to a conclusion either way. On the contrary, we do not find that there was any insurmountable o ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
