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TMI Blog2009 (8) TMI 972X X X X Extracts X X X X X X X X Extracts X X X X ..... of the decisions from the hon ble High Court of Patna in the case of Dr. Ajit Kumar Pandey v. ITAT [2009] 21 DTR (Pat) 103 for levy of penalty under section 271, there is no connection or bearing with the total income of the assessee, therefore, the appeal is maintainable. Admittedly, the hon ble High Court concluded that for imposition of penalty under section 271(1)(c) of the Act, it has no connection or bearing with the total income of the assessee, therefore, an appeal against levy of penalty under section 271 is covered by clause (d) of section 253(6) and fee payable is Rs.500 only. No contrary decision was cited by the learned Departmental representative. In view of the above, the defect memo issued to the assessee, is withdrawn. On the merits, it was contended on behalf of the assessee that the Tribunal while deciding the appeal of the assessee sustained the addition of Rs. 15,00,000 against the addition of Rs. 20 lakhs made by the Assessing Officer and partly sustained by the learned Commissioner of Income-tax (Appeals). The further addition of Rs. 2,44,555 for outstanding labour payable, made by the learned Commissioner of Income-tax (Appeals) was also deleted. Our atte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee and even the particulars of drivers to whom the payments were made were also not maintained. The Assessing Officer made disallowance of Rs. 20,00,000. On appeal before the learned Commissioner of Income-tax (Appeals), it was claimed that complete records of labour, payments were maintained by the assessee, therefore, the Assessing Officer was not justified in making the comparison with HAFED as loading unloading charges differ from case to case as the same is dependent upon the type, extent and availability of labour. Plea was also raised that complete records for labour payments and receipts were practically not possible as the labour keep on changing from place to place. The disallowance of Rs. 20 lakhs was claimed to be made merely on presumptions. The learned Commissioner of Income-tax (Appeals) reduced the addition by a sum of Rs. 1,22,520 and sustained the addition to Rs. 18,77,480. The assessee carried the matter before the Tribunal wherein the addition of Rs. 15 lakhs was sustained against the addition of Rs. 20,00,000 made by the Assessing Officer and partly sustained by the learned Commissioner of Income-tax (Appeals). The further addition of Rs.2,44,555 for outst ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t year 2000-01. Similarly, the labour and transport expenses carried over this year and paid in the next year were also verified by the learned Assessing Officer during assessment proceedings for 2001-02. In view of these facts, it can be said that there was no conscious act by the assessee, which lead to the concealment of income or furnishing of inaccurate particulars of income. The decision from the hon ble apex court in K. C. Builders v. Asst. CIT [2004] 265 ITR 562 supports the case of the assessee. The decision from the hon ble Delhi High Court in the case of CIT v. Bacardi Martini India Ltd. [2007] 288 ITR 585 also supports the case of the assessee. The decision from the hon ble jurisdictional High Court in the case of CIT v. Budhewal Co-operative Sugar Mills Ltd. [2009] 312 ITR 92 (P H) wherein all particulars relating to computation of income were disclosed, the cancellation of penalty under section 271(1)(c) was held to be justified. Identical ratio was laid down in the cases of Harigopal Singh v. CIT [2002] 258 ITR 85 (P H) and CIT v. SSP. P. Ltd. [2008] 302 ITR 43 (P H). In the present appeal, the addition was on estimation and was reduced by the appellate authority. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in these appeals to a larger Bench doubting the correctness of the view expressed in Dilip N. Shroff v. Joint CIT [2007] 291 ITR 519 (SC) ; [2007] 8 SCALE 304 . The question which arises for determination in all these appeals is whether section 11AC of the Central Excise Act, 1944 (in short the Act ) inserted by the Finance Act, 1996 with the intention of imposing mandatory penalty on persons who evaded payment of tax should be read to contain mens rea as an essential ingredient and whether there is a scope for levying penalty below the prescribed minimum. Before the Division Bench, the stand of the Revenue was that said section should be read as penalty for a statutory offence and the authority imposing penalty has no discretion in the matter of imposition and penalty and the adjudicating authority in such cases was duty bound to impose penalty equal to the duties so determined. The assessee on the other hand referred to section 271(1)(c) of the Income-tax Act, 1961 (in short the IT Act ) taking the stand that section 11AC of the Act is identically worded and in a given case it was open to the Assessing Officer not to impose any penalty. The Division Bench made reference to rul ..... X X X X Extracts X X X X X X X X Extracts X X X X
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