Penalty for delayed return upheld where the assessee failed to prove reasonable cause for filing the return late.

Penalty for delayed filing of a return under section 271(1)(a) was held sustainable where the assessee failed to produce supporting material for the stated cause of delay. The explanation that the munim had fallen ill and accounts could not be finalised was rejected by the tax authorities and the Tribunal, which found no reasonable cause on the record. The Tribunal also noted that the same explanation had earlier been disbelieved for another assessment year. The matter was treated as one of appreciation of evidence rather than a substantial question of law, and the penalty was upheld against the assessee.

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Issues: Whether the penalty for delayed filing of the return under section 271(1)(a) of the Income-tax Act, 1961 was leviable on the assessee.

Analysis: The assessee filed the return with a substantial delay and offered only the explanation that the munim had fallen ill and could not finalise the accounts. That explanation was rejected by the income-tax authorities and the Tribunal because no supporting material was produced to substantiate it. The Tribunal also noticed that the same explanation had earlier been rejected in respect of another assessment year. On these facts, the reference was treated as turning essentially on appreciation of the material, and not on any substantial question of law.

Conclusion: The penalty was held leviable and the question was answered in the affirmative, against the assessee and in favour of the Revenue.

Ratio Decidendi: A penalty for delayed return is sustainable where the assessee fails to adduce material evidence supporting the explanation for default and the finding of absence of reasonable cause is based on proper appreciation of the record.

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