9911796707
TMI Blog1983 (4) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... nces of the case, the confirmation of the amount of penalty imposed notwithstanding the reduction in the income assessed was correct ?" The statement of the case, as originally submitted to this court, sets out the following facts: The assessment year concerned is 1963-64, and the matter relates to the levy of penalty in terms of s. 273(b) of the Act. The assessee is a firm. It returned an income of Rs. 36,900 for the relevant year. Under the provisions of the Act it was under an obligation to file its estimate of advance tax payable in terms of s. 212(3) of the Act. It did not file such an estimate. The ITO levied penalty of Rs. 1,600 under s. 273(b) of the Act. A copy of the order passed by the ITO has been marked annex, " A " formi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed annex. " B". The Revenue, being aggrieved by the order of the AAC, appealed to the Tribunal and the assessee filed a cross-objection in that appeal. Both the matters were heard and decided together. The Tribunal held that, viewing the orders of the ITO in their proper perspective, it was obvious that the order of the ITO to initiate penalty proceedings was contemporaneous and simultaneous with the assessment order itself. Relying upon a decision of the Madras High Court in the case of Artisan Press Ltd. V. Income-tax Appellate Tribunal (1958] 33 ITR 670, the Tribunal held that the penalty proceedings were properly commenced during the course of the main assessment proceedings and the departmental appeal was allowed. copy of the Tribun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which would not mislead the assessee so as to invalidate the notice and the assessee had in no way been prejudiced in its defence as a result of any such defect. The Tribunal ultimately concluded thus: "In the circumstances we hold that the alleged defect in the notice is not so vital as to invalidate the proceedings or render the imposition of penalty as void. " It was further urged on behalf of the assessee that the ITO imposed penalty of Rs. 1,600 taking the income assessed at Rs. 1,39,362 but the AAC bad, on appeal, reduced the quantum of assessment by Rs. 50,305 and, therefore, the penalty should proportionately be reduced. The Tribunal, however, observed that a reduction in the income assessed does not necessarily and automatic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeal before the AAC and the AAC, by his order dated 31st July, 1967, allowed a relief of Rs. 50,305. The assessee further came up to the Tribunal and the Tribunal, by its appellate order, set aside the order and remanded the case to the AAC with some directions. The AAC, by his second order dated 25th February, 1972, further allowed a relief of Rs. 49,181. Thus, the final income of the assessee stood at Rs. 39,876 as against the return submitted to the tune of Rs. 36,900 by the assessee. The tax payable on the income assessed by the ITO for the purpose of s. 273 amounted to Rs. 7,902 whereas the tax on the final income of Rs. 39,876, as finally assessed, amounted to Rs. 749. After allowing deduction under s. 273(b)(ii) read with s. 217(1) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Income-tax Officer, in the course of any proceedings in connection with the regular assessment, for the assessment year commencing on the 1st day of April, 1970, or any subsequent assessment year, is satisfied that any assessee-... (b) has without reasonable cause failed to furnish an estimate of the advance tax payable by him in accordance with the provisions of sub-section (3) of section 212, or ...... be may direct that such person shall, in addition to the amount of tax, if any, payable by him, pay by way of penalty a sum-... (ii) which, in the case referred to in clause (b), shall not be less than ten per cent. but shall not exceed one and a half times of seventy-five per cent. of the assessed tax as defined in sub-section (5) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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