9911796707
TMI Blog1976 (6) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... ified in holding that the penalty under s. 271(1)(a) of the I.T. Act, 1961, can be imposed in spite of the filing of the return within the time allowed under s. 139(4) of the I.T. Act, 1961, taking into consideration the decision of the Supreme Court in the case of CIT v. Kulu Valley Transport Co. P. Ltd. [1970] 77 ITR 518 ? " The assessee is a partner in a firm known as M/s. Saraf Motor Company. He filed his I.T. return relating to the assessment year 1962-63, on April 20, 1965. The return should have been filed in June, 1962. Even after issue of notice under s. 139(2) of the Act, he went on defaulting and so the ITO initiated a penalty proceeding under s. 271(1)(a) of the Act. In the penalty proceeding the assessee pleaded before the IT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d counsel appearing for the assessee submitted before the Tribunal that the observation of the AAC that the assessee pleaded only for reduction of the penalty before him and did not urge any other point is not correct. He wanted time to file an affidavit sworn by the lawyer who appeared before the AAC for the assessee in support of this contention. The Tribunal acceded to this prayer and adjourned the case till July 2, 1973. As neither the assessee nor his counsel appeared on this date and as no step was taken, the Tribunal proceeded to dispose of the appeal ex parte on a consideration of the materials on record. In the absence of any affidavit from the lawyer concerned the Tribunal accepted the statement of the AAC that no other point was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the question No. (i) is concerned, the Tribunal held that the question as to whether the assessee had or had not any reasonable cause for not filing the return in time is a question of fact. The Tribunal having held that he had no reasonable cause, no question relating to this finding could be referred. The Tribunal was, however, of the opinion that in view of the decision of the Supreme Court in CIT v. Kulu Valley Transport Co. P. Ltd. [1970] 77 ITR 518, the question as to whether the return filed under s. 139(4) should be treated to have been filed within the time allowed under s. 139(1) or s. 139(2) of the Act, to exonerate the assessee from penalty under s. 271(1)(a), which is a question of law, does arise out of its order and, accordi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tram's case [1978] 112 ITR 187 (Gauhati) is not applicable in the present case. The question referred in that case is very much the same with the question that has been referred in this case. Be that as it may, we propose to deal with the submissions which were made before us by Mr.Sen. His first contention was that the satisfaction of the ITO that the assessee had no reasonable cause for not filing the return within the time allowed, is a condition precedent to the imposition of penalty under s. 271(1)(a) and, therefore, in disposing of the appeal it was incumbent on the Tribunal to examine on the materials on record as to whether or not the assessee had such reasonable cause. According to him, the Tribunal was wrong in recording its fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is return at any time within 4 years from the end of the assessment year before the assessment is made and, therefore, the assessee having filed his return within such time, the imposition of penalty should have been held to be illegal by the the Tribunal even if it was found that he had no reasonable cause for not filing the return within the time allowed under sub-ss. (1) and (2) of s. 139. This question is not res integra Besides our own decision in Hanutram's case [1978] 112 ITR 187 (Gauhati), the Gujarat High Court in Addl. CIT v. Santhosh Industries [1974] 93 ITR 563, 564 held : " The words ' within the time allowed.....by sub-s. (1) of s. 139 ' in the second clause of s. 271(1)(a), according to their plain natural meaning, must b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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