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TMI Blog2007 (4) TMI 188X X X X Extracts X X X X X X X X Extracts X X X X ..... wer the following question:- "Whether on the facts and in the circumstances of the case, the Hon'ble Tribunal is justified in law in holding that penalty under Section 271(1)(c) is not leviable in the case where no positive income has been assessed?" 2. Brief facts of the case are that the respondent-Company is a Private Limited Company. For the assessment year 1982-83, it filed return declaring net loss of Rs.3,95,000. The Assessing Officer completed the assessment at net loss of Rs.3,77,231. For Assessment year 1983-84, it filed return declaring net loss of Rs.11,65,020/-. The A.O. completed the assessment at net loss of Rs.1,00,882/-. Quantum appeal filed by assessee for Assessment Year 1983-84 was dismissed by the CIT(A). Against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that when there is loss penalty for concealment of income is not leviable because there cannot be any motive to conceal the income. Tribunal further held that since no contrary judgment of any other High Court is pointed out, therefore the above judgment is binding on us and, therefore, there is no question of tax penalty arises and no penalty under Section 271(C) is leviable and, allowed the appeals filed by the assessee. Thereafter the Revenue filed an application for referring the aforesaid question to this High Court for its opinion and on the request of Revenue the aforesaid question has been referred to this High Court for its opinion. 4. We have heard Shri R.D. Jain, learned Senior Advocate on the question referred to us and h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... naccurate particulars have been furnished has the effect of reducing the loss declared in the return or converting that loss into income, means the tax that would have been chargeable on the income in respect of which particulars have been concealed or inaccurate particulars have been furnished had such income been the total income;] (b) in any case to which Explanation 3 applies, means the tax on the total income assessed; (c) in any other case, means the difference between the tax on the total income assessed and the tax that would have been chargeable had such total income been reduced by the amount of income in respect of which particulars have been concealed or inaccurate particulars have been furnished.]" 6. In view of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the question of any penalty does not arise. In fact, the evasion of the tax is the sine qua non for imposition of penalty. If the penalty or further sum payable by a person would be in addition to any tax payable by him. If losses are shown certainly no penalty can be imposed. The income under the provisions of law taxable is presupposes with regard to the assessment year herein question. If there is no taxable income or the assessed tax for payment during the particular year in any case it is cannot be ,presumed that it is the case of evasion of tax and penalty can be imposed. Penalty can only be imposed when there is concealment of the income. If on enquiry losses were found justified, they cannot be reduced and the positive income canno ..... X X X X Extracts X X X X X X X X Extracts X X X X
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