2015 (10) TMI 2109

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....djournment of the case which was rejected by the Bench. 3. The grounds of appeal of the Revenue in assessment year 2008-09 are as under:- "1. On the facts and in the circumstances of the case, the ld.CIT(A) has erred in law in reducing the penalty from 50% to 10% of the outstanding demand on account of self assessment tax; levied by the AO u/s 221(1) read with Section 140A(3) of the IT Act, 1961. 2. On the facts and in the circumstances of the case, the ld.CIT(A) failed to appreciate that quantum of penalty levied by the JCIT, Bhiwani Range, Bhiwani is reasonable, fair and appropriately levied @ 50% of the total demand outstanding on account payment of self assessment tax. The maximum penalty leviable u/s 221(1) of the ....

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....21(1) to 10% of the tax demand is against the facts and circumstances of the case." 5. The grounds of appeal of the Revenue in assessment year 2009- 10 are as under:- "1. On the facts and in the circumstances of the case, the ld.CIT(A) has erred in law in reducing the penalty from 50% to 10% of the outstanding demand on account of self assessment tax; levied by the AO u/s 221(1) read with Section 140A(3) of the IT Act, 1961. 2. On the facts and in the circumstances of the case, the ld.CIT(A) failed to appreciate that quantum of penalty levied by the JCIT, Bhiwani Range, Bhiwani is reasonable, fair and appropriately levied @ 50% of the total demand outstanding on account payment of self assessment tax. The maximum penalt....

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....ting the penalty levied u/s 221(1) to 10% of the tax demand is against the facts and circumstances of the case." 7. Learned DR submitted that learned CIT(A) has grossly erred in reducing the penalty from 50% to 10% of the outstanding demand on account of self assessment tax levied by the Assessing Officer u/s 221(1) read with Section 140A(3) of the Income-tax Act, 1961. He submitted that the maximum penalty leviable u/s 221(1) of the Act was equal to the amount of tax in arrears, whereas the Assessing Officer was reasonable and appropriately levied the penalty on 50% of the total demand and no reason has been given by the CIT(A) for reducing the penalty to 10% of the outstanding demand. He relied on the decision of Cochin Bench of the Tr....

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....r the installment order. We find that for the assessment year 2008-09, the assessee has paid the entire demand of Rs. 10.46 crores except that of Rs. 1,21,64,826/- before the date of passing of penalty order u/s 221(1) on 17.11.2011. The CIT(A) has recorded that the assessee has paid the entire demand for both the assessment years 2008-09 and 2009-10 along with the amount due u/s 220(2) by 29.03.2012. The provision of Section 221(1) does not specify any minimum penalty but specifies that total amount of penalty shall not exceed the amount of tax in arrears. Considering the totality of facts and circumstances of the case, learned CIT(A) was of the view that penalty at 50% of the outstanding demand was very harsh and unjustified. He has cited....