1982 (11) TMI 77

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....mpleting the assessment proceedings initiated penalty proceedings u/s 271(1) (a) of the Act. 2. Before the ITO in penalty proceedings on behalf of the assessee a detailed explanation dt. 7th Nov., 1981 was filed. Inter alia it was explained that the work of filing the returns and other tax matters were attended by accountant Shri Basiruddin. At the relevant time he fell ill and ultimately he was operated in 1978 in Kasturba Hospital, Bhopal. Somehow, or the other the returns of the films could be filed on 30th June 1976 with great difficulty. The other partners could not compile the information regarding their share income from the different firms. On 30th June 1976 extension application were given in form No. 6 seeking time upto the 30t....

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....ssued by the department. It was also contended that there is nothing on the record to show that the assessee in conscious disregard of their obligations failed to file the returns within the time. It was further contended that practically the disclosed income was accepted by the department except minor additions. 5. The ld departmental representative supported other order of the ld. AAC. According to him, wherein the firm filed the return on 30th June 1976 and thereafter it was for the partner to file the returns as early as possible. No reasonable causes were shown by the partner as to why they failed to file the returns within the time. Thus, it was contended that the finding of the ld. AAC is quite correct. 6. I have heard the part....

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....O did not say that the explanation so given by the assessees was false. He only disbelieved the explanation given by the assessee. The ld. AAC did not bring on record any material to show that the explanation given by the assessees was false. In any view of the matter the explanation given by the assessee was reasonable and probable. At least there was no material on record to prove that the explanation given by the assessees was false. 8. It is pertinent to note that the assessees were aware about their liability to file the returns. They did file the extension application in Form. No. 6. In the said extension application it was that stated that on account of illness of the accountant necessary information for filing the returns were no....