1980 (9) TMI 73 - HC - Income Tax

High Court upholds Tribunal decision on penalty for false tax estimate

Commissioner Of Income-Tax, West Bengal IV Versus SB. Electric Mart Pvt. Limited

The High Court of Calcutta upheld the Tribunal's decision in a case involving the assessment year 1961-62, where a private limited company faced a penalty ... Advance Tax, False Estimate, Penalty Issues involved: Assessment year 1961-62, imposition of penalty under section 273(a) for filing untrue advance tax estimate.Summary:The High Court of Calcutta considered the case involving the assessment year 1961-62 where a private limited company filed an advance tax estimate showing lower income than later reported in the return. The Income Tax Officer imposed a penalty under section 273(a) for filing an untrue estimate. The Appellate Assistant Commissioner canceled the penalty, stating the difference in income was not due to deliberate suppression. The matter reached the Tribunal, which emphasized the need for evidence that the assessee knowingly filed a false estimate to attract the penalty under section 273(a. The Tribunal found no such evidence and concluded that the assessee did not have reason to believe the estimate was false. The Tribunal's decision was challenged, but the High Court upheld the Tribunal's findings, emphasizing the specific requirements of section 273(a) regarding the knowledge or belief of the assessee in filing a false estimate.In conclusion, the High Court affirmed the Tribunal's decision, stating that there was no evidence to suggest the assessee knowingly filed a false estimate, as required by section 273(a). The Court found no grounds to challenge the Tribunal's findings and ruled in favor of the assessee, upholding the cancellation of the penalty imposed by the Income Tax Officer.