TaxTMI 
TaxTMI 
1986 (7) TMI 179
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....at the appellant firm submitted an estimate of advance tax under section 209A(4) of the Act on 11-9-1980 estimating income of Rs. 90,160. On13-3-1981the firm filed another estimate in Form No. 29 revising income at Rs. 8 lakhs and advance tax payable thereon to the tune of Rs. 1,95,800. The return of income, however, was filed at Rs. 38,79,170 against which assessment was completed on30-3-1982on an income of Rs. 38,99,160. 3. The ITO issued a show-cause notice requiring the assessee to explain as to why penalty be not imposed for filing estimate of income which it knew or had reason to believe to be untrue. The assessee filed explanation in response. 4. Before proceeding further, however, we like to state that the ITO captioned the pe....
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....mate of advance tax under sub-sections (2), (3) or sub-section (5) of section 209A. This could be done in case the appellant was of the opinion that it was liable to earn less than that on the basis of which he was required to file a statement of advance tax under section 209A(1)(a). Of course, sub-section (5) of the said section is also available for revising an estimate. However, the provision of sub-section (4) of section 209A provides that where an assessee by his current income being likely to be greater than the income on which the advance tax is payable or for any other reason the amount of advance tax computed in the manner laid down in section 209 of the Act on the current income exceeds the amount of advance tax so payable by more....
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....he assessee had filed untrue estimate knowingly. At this stage we like to bring in close focus the relevant provision of sub-section (2) of section 273 : "(2) If the Income-tax Officer, in the course of any proceedings in connection with the regular assessment for the assessment year commencing on the 1st day of April, 1970, or any subsequent assessment year, is satisfied that any assessee--- (a) has furnished under sub-section (1) or sub-section(2) or sub-section (3) or sub-section (5) of section 209A, or under sub-section (1) or sub-section (2) of section 212, an estimate of the advance tax payable by him which he knew or had reason to believe to be untrue, or (aa) has furnished under sub-section (4) of section 209A or under sub-....
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....t. was much higher than average profit rate of about 20 per cent. However, in the explanation dated28-3-1984the assessee stated that the tender in relation to the supply of country liquor to Madhya Pradesh was accepted in the month of January 1981 and for such supply the Excise Commissioner, UP issued permits in February 1981 and in March 1981. Therefore, we could understand a case where the assessee transacted unexpected business after filing of the estimate but such posture could not be rationally adopted by the assessee. Having been issued permits for supply of liquor in February and March 1981 the assessee could reasonably estimate its business and income for the whole month of March. In any case disparity between the estimate of income....