Section 273A discretion invalid when extraneous rule 117A considerations influence the decision; matter remitted for fresh determination.

Section 273A discretion must be exercised only on the statutory conditions of voluntary and good-faith disclosure, and payment of tax on the disclosed income before the relevant notices. Considerations relevant to delay in filing the return under rule 117A do not belong to the Commissioner's inquiry under section 273A. Because the order was influenced by an extraneous factor, it could not stand and was quashed, with the matter remitted for fresh decision on the correct statutory basis.

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Issues: Whether the Commissioner's order under section 273A of the Income-tax Act, 1961 was vitiated because it was influenced by considerations relevant only to rule 117A of the Income-tax Rules, 1962, and whether the matter required fresh determination in accordance with the proper statutory criteria.

Analysis: The power under section 273A(1)(iii) is confined to considering whether the assessee made a voluntary and good faith disclosure of income and paid the tax on the amount disclosed before the statutory notices contemplated by the provision. The inquiry as to sufficient cause for delay in filing the return belongs to rule 117A and to the Income-tax Officer, not to the Commissioner acting under section 273A. Since the impugned order proceeded at least in part on the irrelevant question of tax planning as sufficient cause, the decision was based on an extraneous consideration and could not stand.

Conclusion: The impugned order was quashed and the application was directed to be reconsidered afresh under section 273A in accordance with law.

Final Conclusion: Relief was granted to the assessee by setting aside the Commissioner's order and remitting the matter for fresh decision on the correct statutory basis.

Ratio Decidendi: A discretionary order under section 273A must be made only on the statutory conditions governing that provision, and an order influenced by considerations belonging to a different provision is liable to be set aside for taking into account extraneous matters.

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