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TMI Blog2005 (3) TMI 28X X X X Extracts X X X X X X X X Extracts X X X X ..... enalty under section 271(1) of the Act is imposable - we answer the question referred to us in the negative, i.e., in favour of the Department and against the assessee. - - - - - Dated:- 22-3-2005 - Judge(s) : R. K. AGRAWAL., P. KRISHNA. JUDGMENT The judgment of the court was delivered by Prakash Krishna J. - The Income-tax Appellate Tribunal, Allahabad, at the instance of the Revenue has referred the following question of law under section 256(1) of the Income-tax Act, 1961 (hereinafter referred to as "the Act") for opinion to this court: "Whether, on the facts and in the circumstances of the case, the Tribunal was legally justified in holding that no penalty could be imposed on a registered firm where the advance-tax paid exce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sub-section (2) of section 139 or section 148 or has failed to furnish it within the time allowed in the manner required by sub-section (1) of section 139 or by such notice, as the case may be, may direct that such person shall pay the penalty. Sub-section (2) of-section 271 of the Act reads as follows: "(2) When the person liable to penalty is a registered firm or an unregistered firm which has been assessed under clause (b) of section 183, then, notwithstanding anything contained in the other provisions of this Act, the penalty imposable under sub-section (1) shall be the same amount as would be imposable on that firm if that firm were an unregistered firm." Thus, section 271(1)(a) envisages imposition of penalty for failure to file t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ottam Dass v. CIT [1993] 201 ITR 11 wherein it has been held as follows: "The legal position is that the penalty exigible for delay or default in furnishing the return of income shall be two per cent, for every month during which the default continued and the quantum of penalty is to be calculated with reference to the 'assessed tax', i.e., tax payable on total income, as reduced by the sum, if any, deducted at source or paid as advance tax. However, if the defaulter is a registered firm, for the purpose of imposition of penalty, the firm is to be treated as an unregistered firm and, so treated, the 'assessed tax' must be calculated on the basis that it was an unregistered firm." This court has followed the judgment of the Madhya Prades ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on the assessed income. Perhaps the attention of the Tribunal was not drawn towards sub-section (2) of section 271 of the Act. For the purposes of calculation of the penalty amount, the assessee-firm shall be deemed to be an unregistered firm and the assessed tax has to be calculated accordingly to find out as to whether excess advance tax was paid. The Tribunal has placed reliance upon a judgment of the Rajasthan High Court in the case of CIT v. Builders Engineers Co. [1989] 175 ITR 317. But in view of the authoritative pronouncement of this court in the case of Ram Bilas Purshottam Dass [1993] 201 ITR 11 we respectfully dissent with the view taken by the Rajasthan High Court on this point. There appears to be divergence of opinion among ..... X X X X Extracts X X X X X X X X Extracts X X X X
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