9911796707
TMI Blog1997 (5) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... ntions that the penalty proceedings were initiated under section 273(2)(1), for the assessee's failure to pay correct amount of advance tax and that in reply to the show-cause notice, the assessee stated that due to insufficiency of funds, the payment could not be made on due dates. The explanation was not considered to be satisfactory and the Assessing Officer levied penalty of Rs. 20,474 under section 273(2)(a). 2. In the first appeal also, the same plea about lack of funds for making payment of the advance tax was taken up by the assessee. The CIT (Appeals), however, did not agree with the contention of the assessee. He stated that with regard to payment of advance tax, financial stringency can hardly be said to be a reasonable cause. H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estimate of advance tax payable by the assessee which he knew or had reason to believe to be untrue. At the same time again, learned counsel for the assessee has also pleaded that financial stringency constituted a reasonable cause behind the failure to pay the advance tax actually. It is, thus, pressed that the penalty cancelled. 4. The learned DR, on the other hand, has drawn our notice to the broad heading of section 273 which reads in block letters as below : "False estimate of, or failure to pay, advance tax" He thus argues that even failure on the part of an assessee to make actual payment of the advance tax is also covered by relevant section. In support of his argument, he draws our attention to the discussions made by the Supr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ile proper estimates of advance tax and also to pay taxes in accordance with the same. It is, thus, argued that default of the nature of failure to make actual payment should also count for the purpose of levy of penalty under section 273. As regards, the plea taken up by the assessee relating to stringency of funds, he says that the said fact is not proved by any evidence. He relies on the Full Bench decision of the Patna High Court in the case of CWT v. Sri Jagdish Prasad Choudhary [1995] 211 ITR 472 to contend that a reasonable cause means a cause beyond the control of the assessee. The learned counsel for the assessee, on the other hand, stated in this connection that evidences regarding shortage of fund were placed by the assessee bef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the aforesaid statutory provisions. A penal provision is quasi-criminal in nature and, hence, its language, so far as it is against the assessee, is required to be construed in a very strict manner. There is no room for reading between lines or inserting any provision in a penal statute, especially when in a case like the present one, the language used in the relevant clauses are plain and simple. This particular issue is also found to have been discussed at length by the distinguished authors Charturvedi & Pithisaria in their famous book 'Income-tax Law' (4th addition), Vol. 5 at pages 5968 and 5969. They clearly state that the marginal note to section 273 goes beyond its provisions inasmuch as although the question of payment of advance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bay High Court in the case of Dharmavat Provision Stores v. CIT [1983] 139 ITR 700/[1981] 7 Taxman 90 at page 703, Delhi High Court in the case of CIT v. Loke Nath & Co. [1984] 147 ITR 624/17 Taxman 209 at page 636 and by the Karnataka High Court in the case of Khoday Industries (P.) Ltd. v. CIT [1987] 163 ITR 646/[1986] 26 Taxman 732. 8. We have, therefore, got to come to the conclusion that the mention of the expression "failure to pay advance tax" in the heading of section 273 does not add anything to what has clearly been stated in the language used in the relevant section. Inasmuch as neither clause (a) nor clause (b) of sub-section (2) of section 273 mentions the default of not paving the advance tax, we are of the opinion that penal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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