9911796707
TMI Blog2007 (4) TMI 220X X X X Extracts X X X X X X X X Extracts X X X X ..... e light of the false information for the purpose of benefits in terms of the Act. The same was challenged before the appellate authority. The appellate authority has chosen to dismiss the same thereby confirming the findings of the Assessing Officer. Surprisingly, when the matter was taken to the Tribunal, the Tribunal has failed to look into the matter for the purpose of false information in terms of section 271(1)(c) in its order. On the other hand, the Tribunal condones the conduct by holding that the claim was made on the basis of the certificate issued by the factory manager. The Tribunal forgot to notice that when the claim was made on the basis of installation, the machinery had not even left the premises of the seller. The defence o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r levied a penalty under section 271(1)(c) of the Act for concealment of income on the cost of purchase of machinery amounting to Rs. 14,65,669.80. The penalty levied is Rs. 8,00,000 for concealment. Aggrieved by the same, an appeal was filed before the Commissioner of Income-tax (Appeals). The Commissioner (Appeals) agreed with the levy of penalty and confirmed the same. The assessee filed an appeal before the Tribunal. The Tribunal cancelled the penalty levied by the Assessing Officer on the ground of no concealment in terms of the Act. The Revenue aggrieved by the same filed a miscellaneous petition to rectify the errors. The Tribunal rejected the same. Thereafter the Revenue sought for a reference to this court. After hearing, the Tribu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... maintaining proper records showing full particulars including quantitative details and situation of fixed assets. These fixed assets were physically verified by the management and no serious discrepancies were noticed on verification. The assessee consistently maintained that the machinery had arrived and put to use before June 30, 1984, whereas by June 30, 1984, the machinery was not even dispatched from the seller' s factory premises. The assessee is not a small one time assessee who does not know the intricacies of the Income-tax Act. The managing director of the company is aware that only if the machinery were put to use, the company is eligible for depreciation, investment allowance, etc. The Assessing Officer also would notice tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has also chosen to rely on a judgment in T. Ashok Pai v. Asst. CIT [1994] 51 ITD 467 (Bang.). Thereafter, a miscellaneous petition was filed stating that the assessee made the claim by way of its return of income which was filed on July 30, 1985. The certificate of the factory manager was issued more than two years later, i.e., on October 24, 1987. The Revenue wanted the matter to be reconsidered. The Tribunal has rejected by saying that no review power is available to the Tribunal. 4. From the material on record what is clear to us is that the assessee has chosen to claim the benefit with regard to machinery on the ground of putting the machinery to use before June 30, 1984, whereas the machinery was not even dispatched from the seller& ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r would come to the aid of the assessee in a matter like this. In fact the Tribunal has chosen to rely on its decision rendered in T. Ashok Pai v. Asst. CIT [1994] 51 ITD 467 (Bang.). In the said order, the Tribunal would say that no fault could, therefore, be found with an assessee who, bona fide, relied on his tax counsel-cum-agent in the matter of preparation of his Income-tax and wealth-tax returns including the work of computation of income/loss/net wealth for the said purpose. If the legal counsel/agent committed a blunder in the exercise of his duty, not in a mala fide manner, not again in collusion with the assessee, the assessee should not be visited with penalty under section 271(1)(c). Therefore, the assessee could not be conside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o consider the issue of penalty and the defence of the assessee with regard to the omission at the instance of the representative. This court has ruled in paragraph 11 reading as under : 11. In the case on hand, it is admitted that the bogus document is filed and it is created for the purpose of getting exemption. Only defence of the assessee is that it is at the instance of his representative. It cannot be forgotten that the assessee is bound by what his representative acts on his behalf in the matter. We are not prepared to believe the plea of the assessee that he is totally unaware of the creation of bogus document by his previous STP as sought to be argued before us. The assessee is fairly a big dealer having turnover of more than ..... X X X X Extracts X X X X X X X X Extracts X X X X
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