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TMI Blog2007 (4) TMI 208X X X X Extracts X X X X X X X X Extracts X X X X ..... guardian has made a statement that the whole thing was done under his advice. Section 271(1)(c) would provide for penalty under the Act in the event of the Assessing Officer or the Commissioner being satisfied that any person has failed to comply with a notice under sub-section (1) of section 142 or sub-section (2) of section 143 (or fails to comply with a direction issued under sub-section (2A) of section 142). Person has been defined u/s 2(31). A careful reading of the definition of person would show that a minor cannot said to be a person for the purpose of section 271(1)(c) of the Act. we are of the view that a minor cannot be saddled with any penalty for any omission and commission committed by others acting on behalf of the minor. In CIT v. R. Srinivasan [ 1997 (1) TMI 44 - MADRAS HIGH COURT] has ruled that any sum payable by the guardian on behalf of the minor is recoverable u/s 162 of the Act by the guardian including penalty for the default committed by him. The logic is simple. Any omission or commission committed by a representative or a guardian cannot be fastened on the minor in terms of the Act. Therefore, we deem it proper to hold that no penalty can be l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tative. The Assessing Officer was of the opinion that the legal representative could not bring on record any material to suggest that it was not really income that was concealed by the assessee. He invoked the provisions of Explanation 1 to the said section. The matter was taken in appeal. The appellate authority quashed the penalty order. The matter was taken to the Tribunal by the Revenue. The Tribunal has chosen to reject the appeal. It is in these circumstances, the Revenue is before us. 4. Sri Indra Kumar, learned senior counsel would take us through the material on record to say that the Tribunal has committed a serious error both in law and on facts in holding that there is no concealment in the case on hand. He would refer to us the earlier proceedings and other material on record to contend that concealment is fully proved in the case on hand and that therefore, according to him, the finding of no concealment is factually and legally unsustainable. He therefore says that in the light of concealment, penalty levied is in order. He further elaborates by arguing that a representative of the assessee is answerable for penalty. 5. Per contra, learned counsel for the respo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der was passed on March 25, 1986. The said order was subsequently considered. To the penalty proceedings, reply was submitted by the assessee. The Assessing Officer would notice that it has been found on an examination of Sri R. V. Kalro and Smt. Shobha R. Kalro, that the gifts could not be genuine. He also noticed the alleged donors have no normal contact in the matter. He noticed that these amounts were brought in the guise of gifts . He also noticed that the return was filed by Sri. Radhakishandas V. Kalro, father and natural guardian of Master Sunil R. Kalro. He would notice that the books of account are written under his advice and the entry regarding the amount received by draft stated to be gift in the capital account is also made under his advice. The explanation, to say the least, cannot be accepted in the light of a detailed examination of facts by the Assessing Officer. It cannot be said that there is no concealment in the case on hand. It also cannot be said that the assessees has furnished accurate particulars of income. On the other hand, the assessee has chosen to furnish inaccurate particulars by way of concealment, as we see from the material on record. The Assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, we see that admittedly, the assessee is a minor. The natural guardian has made a statement that the whole thing was done under his advice. Section 271(1)(c) would provide for penalty under the Act in the event of the Assessing Officer or the Commissioner being satisfied that any person has failed to comply with a notice under sub-section (1) of section 142 or sub-section (2) of section 143 (or fails to comply with a direction issued under sub-section (2A) of section 142). 9. Person has been defined under section 2(31). A careful reading of the definition of person would show that a minor cannot said to be a person for the purpose of section 271(1)(c) of the Act. Even otherwise in our view a minor has to be protected on account of the age factor. In fact several other enactments would also provide sufficient safety to the minor acts. Therefore, despite the strong arguments of Sri Indra Kumar, learned senior counsel, we are of the view that a minor cannot be saddled with any penalty for any omission and commission committed by others acting on behalf of the minor. 10. In fact, the Kerala High Court in (sic) has ruled that an individual is different from a person. Though, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court has chosen to say that an assessment can be made on the representative-assessee in respect of a minor and also a direct assessment can be made on the minor. But however, the Allahabad High Court has not chosen to say anything with regard to liability of the minor in the matter of penalty. The Madras High Court has however chosen to consider the penalty which could be imposed on the guardian. The Madras High Court (see [1997] 228 ITR 214 ) after noticing sections 162 and 271 has ruled that (page 220) : even assuming that the guardian is not entitled to recover the penalty paid under section 271(1)(a) of the Act from the minor' s estate, that would not mean that no penalty is imposable on the guardian for the delay in filing the returns for the minor. Even sections 160 and 161 would deal with representative. Since the Tribunal has not considered this aspect of the matter, we deem it proper to direct the Tribunal to reconsider the liability of a representative with regard to penalty in the given circumstances in the light of Chapter XV of the Income-tax Act. The second question is not answered and the matter is remitted back for re-decision. Parties are to appear without w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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