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TMI Blog1988 (9) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... Jewellery, Calicut, Alukkas Tourist Home, Trichur, and Alukkas Jewellery, Trichur, respectively. Varghese and Joy are partners in the three firms referred to above. The six writ petitions are by the partners challenging orders passed by the Commissioner by which request for waiving of interest under section 273A was turned down. The background facts leading to the impugned orders are the following : The firms and their partners had been originally assessed to incometax. Final orders of assessment had been passed in respect of the periods 1979-80 to 1983-84. It is conceded that the main income of the partners is the share income from the firms. On January 23, 1985, there was a search in the premises of the firms and the residential premi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioner, Within a week of the search, had filed the revised returns. Those returns were made voluntarily and in good faith. That being so, the penal provisions are not attracted, according to counsel. Section 273A may be conveniently quoted in this context: "273A. Power to reduce or waive penalty, etc., in certain cases (1) Notwithstanding anything contained in this Act, the Commissioner may, in his discretion, whether on his own motion or otherwise, (i) reduce or waive the amount of penalty imposed or imposable on a person under clause (i) of sub-section (1) of section 271 for failure, without reasonable cause, to furnish the return of total income which he was required to furnish under sub-section (1) of section 139 ; or (ii) reduce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uence of an order passed under this Act in respect of the relevant assessment year. Explanation 1.-For the purposes of this sub-section, a person shall be deemed to have made full and true disclosure of his income or of the particulars relating thereto in any case where the excess of income assessed over the income returned is of such a nature as not to attract the provisions of clause (c) of sub-section (1) of section 271. Explanation 2.-Where any books of account, other documents, money, bullion, jewellery or other valuable article or thing belonging to person are seized under section 132 and within fifteen days of such seizure, the person makes a full and true disclosure of his income to the Commissioner, such person shall, for the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of what would have been otherwise a voluntary act. Such external affectation can arise only by way of an element of compulsion ; or by an impact of inducement. Mere eagerness to avoid an inconvenience may not, by itself, be sufficient to affect the voluntary character of an act or transaction. The border line can, at times, be thin, so thin, even to strain-trained eyes. The London and North Western Railway Co. v. Lindsay (3 Macq. 99) was an illustrative case. Blackburn, Lord Justice, commented on that term in Schibsby v. Westenholz (40 Law J. Rep., Q.B. 73). A sentence by way of general observation occurring in that judgment later led to considerable contentions on the scope of its construction. Absent pressure or duress, an act can be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ia Bros. v. CIT [1978] 115 ITR 61, was approvingly referred to (sic.) in the later decision in Hakam Singh v. CIT [1980] 124 ITR 228. In the latter case, an association of persons invoked section 273A for waiver or reduction of the imposable penalty. The association of persons had filed a revised return, about 11 months after a search conducted by the Income-tax Department and the seizure of certain books during the course of such search in the business premises of the two firms in which one of the members of the association of persons was a partner. The Commissioner took the view that the returns were not voluntary. That was confirmed by the High Court. An inference was drawn from the circumstances that the revised returns were the result ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r satisfaction to all concerned. It cannot, however, be said that any of the salient and significant circumstances had been missed or eschewed in the impugned order. It was contended that the overall conduct of the assessee, and the speed with which he filed the revised return after the search, would insulate him in relation to the penal consequences of section 273A(1)(a) and (b). Reference was made in that connection to Explanation 2. The Explanation would really give a contrary indication. That Explanation creates a statutory fiction, limited in its scope and effect. Its operation is in a restricted field. It is inoperative and powerless in other areas, even when they are as adjacent as in section 273A(1)(a) and (b). Had it not been for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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