1988 (12) TMI 103

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..... of the Income-tax Act, 1961, for the assessment year 1965-66 : "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in cancelling the penalty under section 271 (1)(c) of the Income-tax Act, 1961 ?" The facts leading to this reference are that the assessee is a registered firm and the reference relates to the assessment year 1955-56. The assessment in this cas .....

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..... c) ceased to exist. The penalty under section 271(1)(c) imposed by the Inspecting Assistant Commissioner was, therefore, cancelled and the appeal was allowed. We are of the view that inasmuch as the additions which were made in the assessment under section 147 of the Income-tax Act, 1961, had been deleted by the Tribunal, the basis for imposition of penalty ceased to exist. The penalty cannot st .....

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