Reasonable cause for belated return defeated penalty where the Tribunal found no conscious or deliberate default.

Penalty under section 271(1)(a) depended on the assessee proving reasonable cause for the belated return, and mens rea was not a necessary condition for levy. The Tribunal's view that no delay survived merely because the return was filed after the due date was not accepted, but it also made a separate factual finding that the assessee had reasonable cause for the entire period of delay and had not consciously or deliberately disregarded the statutory obligation. On that factual basis, cancellation of the penalty was upheld.

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Issues: Whether penalty under section 271(1)(a) of the Income-tax Act, 1961, was rightly cancelled on the ground that the assessee had shown reasonable cause for the delay in filing the return.

Analysis: The Tribunal's reasoning that no delay survived because the return was filed after the due date could not be accepted. Under section 271(1)(a), the burden lay on the assessee to establish reasonable cause for the belated return, and mens rea was not a necessary condition for levy of penalty. However, the Tribunal also recorded a distinct factual finding that the assessee had reasonable cause for the entire period of delay, and that the delay was not due to conscious or deliberate disregard of the statutory obligation. That finding was one of fact.

Conclusion: The cancellation of penalty was upheld and the reference was answered in favour of the assessee.

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