Penalty for delayed return fails where advance tax exceeds assessed tax and no penalty base remains.

Penalty under section 271(1)(a) was not leviable where the return was filed late after notice under section 148 but the advance tax paid exceeded the tax ultimately assessed on reassessment. Because no assessed tax remained, the computation provision for this penalty could not operate on the facts, and delay alone was insufficient to sustain the levy. The cancellation of penalty was therefore upheld in favour of the assessee.

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Issues: Whether penalty under section 271(1)(a) of the Income-tax Act, 1961 was leviable for delay in filing the return where advance tax already paid exceeded the tax ultimately assessed.

Analysis: The assessee filed the return after notice under section 148. Although there was delay, the tax ultimately determined on reassessment was less than the advance tax already paid. On that basis, there was no assessed tax on which penalty under section 271(1)(a) could be computed. The computation provision for penalty was therefore inapplicable on the facts. The reasoning followed the view that penalty under this provision is dependent on the existence of assessed tax and not merely on delay in filing the return.

Conclusion: Penalty under section 271(1)(a) was not leviable. The cancellation of penalty was in law and was upheld in favour of the assessee.

Ratio Decidendi: Where the advance tax paid exceeds the tax ultimately assessed, leaving no assessed tax, penalty for delayed filing under section 271(1)(a) cannot be worked out and is not leviable.

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