Penalty under section 285A(2) set aside where contract information appeared furnished and hearing time was inadequate.

Penalty under section 285A(2) was not sustained where the record indicated a prima facie case that the required contract information may have been furnished and the assessee had only seven days' notice of the show-cause hearing, which was treated as inadequate for effective representation. The penalty order was set aside and the matter remanded to the Commissioner for fresh decision after granting due opportunity of hearing.

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Issues: Whether the penalty levied under section 285A(2) of the Income-tax Act, 1961, should be sustained when the assessee claimed to have furnished the required information and also complained of insufficient opportunity to show cause.

Analysis: The material placed before the Tribunal indicated a prima facie case that the requisite information regarding the contracts may have been furnished. It was also noticed that the assessee received the show-cause notice only seven days before the hearing date, which was considered too short in the circumstances for effective representation.

Conclusion: The penalty order was set aside and the matter was remanded to the Commissioner for fresh decision in accordance with law after giving due opportunity of hearing to the assessee.

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