2009 (2) TMI 2

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..... tion 256 of the Income-tax Act is as follows :- "Whether on the facts and in the circumstances of the case, the Income tax Appellate Tribunal was correct in law in holding that the assessee's case clearly attracted the application of section 271(1) (c) of the Income tax Act, 1961 and as a sequel thereto confirming the penalty and further giving directions to the Income tax Officer that the quantum .....

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..... come to a categorical finding in its judgment and order dated 25.7.2005 and held that the liability of Rs.9,75,876/- had infact being incurred. In view of this finding, in our view, no penalty under Section 271 (1) (c) could be leviable in respect of this item. 5. In so far as item no.(ii) is concerned, though this was also initially an issue in ITR No.38/89, in view of the Union Bank of India re .....

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..... turns were filed sometime later in 1980, the assessee was thus in the know of the fact that the fine in lieu of confiscation had been cancelled. It is however, contended before us that the assessee had followed the mercantile system and within the assessment year in question they already had made book entries when the liability to pay the fine had accrued. Counsel further contended that these book .....

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