TaxTMI 
TaxTMI 
TaxTMI 
2012 (12) TMI 339
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....ving as under: "In view of the aforesaid, the question of law is answered in negative and in favour of the appellant Revenue and against the respondent assessee. However, we accept the prayer of the respondent assessee to remit the matter to the Tribunal as they have not decided and disposed of the cross objections filed by the respo9ndent assessee on merits. To cut short the delay, the parties are directed to appeal before the Additional Registrar of the Tribunal on 6th August, 2012, when a date of hearing will be fixed." 2. In pursuance to the directions of Hon'ble Delhi High Court, we proceed to decide the cross objections on merit. The assessee has also filed appeal for assessment year 1998-99 against the order of Ld. CIT (A) confirming the penalty u/s 13 of the Interest Tax Act. 3. In the cross objections the assessee has taken identical grounds for A. Ys. 1996-97 and 1997-98 as under: "1. That on the facts and in law the penalty order u/s 13 of the Interest Tax Act,1974 passed by the Assessing Officer is bad in law and void ab initio. 2. That on facts and in law the Assessing Officer erred in no....
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....l and complete disclosure and had given bonafide explanation for the claim made, and therefore, there cannot and should not be any allegation for concealment of particulars of chargeable interest or furnishing of inaccurate particulars of chargeable interest, and consequently, the levy of penalty u/s 13 of the Act is totally unjustified and unwarranted. 5. That on facts and in law the CIT (A) erred in upholding levy of penalty of Rs.86,627/- levied by the Assessing Officer u/s 13 of the Act. The appellant prays for leave to add, alter or amend any grounds of the cross objections raised above, at or before the time of hearing." 4. At the outset Ld. Counsel for the assessee fairly conceded that in view of the decision of Hon'ble Delhi High Court in the assessee's own case for assessment years 1996-97 and 1997-98. Ground nos. 1, 4 and 5 are to be decided against the assessee. We find that Hon'ble Delhi High Court has observed in para 15 and 16 as under: "Bare reading of the sub-section makes it clear that for the purpose of the Act, bill discounting charges have to be treated and regarded as "interest". The term "interest" a....
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.... findings recorded by the Assessing Officer in the penalty order in respect of receipt of Rs.46,63,619/- under the "interest others." "2. Briefly, the facts of the case are that during the courses of assessment proceedings, it was also observed that the assessee company had shown receipt of Rs.46,63,613/- in the profit and loss account on account of interest others but this receipt was not included in the computation of chargeable interest. On being asked to furnish the reasons for non inclusion of the receipt referred above in the computation of chargeable interest, the counsel for the assessee had not advanced any argument. Hence, Rs.48,63,619/-, on account of interest other, was added to the chargeable interest of the assessee." Respectfully following the decision of Hon'ble Delhi High Court, ground nos.1,4 and 5 in Interest Tax Appeal for A. Y.- 1998-99 are dismissed. 5. Thus, both, in the appeal for assessment year 1998-99 and in cross objections for assessment years 1996-97 and 1997-98, the only issue for consideration is whether Assessing Officer had recorded proper satisfaction as warranted u/s 13 of the Act, for initiation of penalty proceedings or no....
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....s, inter-alia, bill discounting charges were treated as interest by Assessing Officer and addition was accordingly made. He submitted that in the assessment order the Assessing Officer has observed as under: "1996-97 Penalty notice u/s 13 of the Act, have already been issued. 1997-1998 Penalty proceedings u/s 13 of the Income Tax Act are separately initiated. 1998-99 Penalty proceedings u/s 13 of the Income Tax Act are separately initiated." Ld. Counsel submitted that the observations of Assessing Officer noted above do not constitute satisfaction as required u/s 13 of the Income Tax Act. In this regard, Ld. Counsel referred to the decision of Hon'ble Delhi High Court in the case of CIT vs. Rampur Engineering Co. Ltd. & Others, 309 ITR 143 (Delhi) (FB) = (2008-TIOL-616-HC-DEL-IT-LB), wherein Hon'ble Delhi High Court observed at page 145 as under: "We hasten to add that pending the reference, sub-section(1B) has been inserted in section 271 of the Income Tax Act by the Finance Act6, 200. The said provision purports to create a fiction by which ....
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....el further referred to the decision of Hon'ble Delhi High Court in the case of CIT vs. Ram Commercial Enterprises Ltd. 246 ITR 568 = (2003-TIOL-69-HC-DEL-IT), wherein, it was observed as under: "The satisfaction as to the assessee having concealed of such income is to be arrived at income or furnished inaccurate particulars of such income is to be arrived at by the Assessing Officer during the course of any proceedings under the Act, which would mean the assessment proceedings, without which, the very jurisdiction to initiate the penalty proceedings is not conferred on the assessing authority by reference to clause (c) of sub- section (1) of section 271 of the Income Tax Act, 1961. A bare reading of the provisions of Section 271 and the law laid down by the Supreme court makes it clear that, it is the assessing authority who has to from his own opinion and record his satisfaction before initiating the penalty proceedings. Merely because the penalty proceedings have been initiated it cannot be assumed that such a satisfaction was arrived at: Held, dismissing the application to direct reference, that the Tribunal had found t....