Penalty cannot survive after final assessment deletes tax demand and no evasion, avoidance, or concealment is found.

Penalty could not be sustained once the provisional assessment merged into the final assessment and the tax and interest demand was deleted. The Tribunal accepted that the assessee's factual position stood reflected in the final assessment, leaving no surviving tax liability and no basis to characterise the matter as involving evasion, avoidance, or concealment of tax. As the foundation for penalty had disappeared, the penalty demand notices were liable to be set aside. The availability of an appellate remedy did not justify withholding relief in the present proceedings.

---

---

Issues: Whether penalty could survive after the provisional assessment merged into the final assessment and the tax and interest demand stood deleted, when the case was found not to involve evasion, avoidance, or concealment of tax liability.

Analysis: The provisional assessment orders ceased to have independent existence after the final assessments were made. The factual position asserted by the assessee was accepted in the final assessments, and the entire tax and interest demand was deleted. On that basis, the matter was not one of evasion, avoidance, or concealment of tax liability. Once no tax liability remained, the foundation for imposing penalty disappeared. The availability of an appeal before the appellate authority did not justify refusing relief in the present proceedings.

Conclusion: The penalty could not be sustained and the demand notices relating to penalty were liable to be set aside in favour of the assessee.

Ratio Decidendi: Penalty cannot survive where the underlying tax liability has ceased and the proceedings disclose neither evasion nor avoidance nor concealment of tax.

---