TaxTMI 
TaxTMI 
2005 (1) TMI 58
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....sed by the Income-tax Officer because he had dropped the penalty proceedings? Whether the Income-tax Appellate Tribunal was justified in holding that penalty under section 271(1)(c) to be passed as a result of the impugned order under section 263 will be barred by time?" The reference relates to the assessment year 1977-78 relating to the penalty proceeding under section 271(1)(c) of the Act. Briefly stated the facts giving rise to the present reference are as under: The respondent-assessee is a registered firm. For the assessment year 1977-78 it had filed a return of loss of Rs. 1,65,850. The assessing authority had completed the assessment on a total income of Rs. 25,601. The addition of Rs. 1,95,105 was made on account of une....
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....enalty proceeding with a direction to the assessing authority to complete the proceeding in the light of the directions given in the order. Feeling aggrieved the assessee preferred an appeal before the Tribunal. The Tribunal has allowed the appeal on two grounds, namely, that the Commissioner of Income-tax had no right to revise under section 263 an order passed under section 271(1)(c) wherein the proceedings have been dropped. Secondly, the penalty order passed under section 271(1)(c) as a result of the order passed under section 263 will be barred by time. Heard Sri A. N. Mahajan, learned standing counsel for the Revenue and perused the record. Nobody appears for the respondent-assessee. Sri Mahajan submitted that the addition of....
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....September 28, 1984. We find that clause (a) to Explanation 4 of section 271(1)(c) of the Act provides that the amount of tax sought to be evaded in a case where the amount of income, in respect of which particulars have been concealed, or incomplete particulars have been furnished exceeds the total income assessed means the tax that would have been chargeable on the income in respect of which particulars have been concealed or inaccurate particulars have been furnished had such income been the total income. Thus, the view of the assessing authority that as the tax effect was nil the order dropping the penalty proceedings was erroneous and also prejudicial to the interests of the Revenue. The Income-tax Officer while dropping the penalty pro....
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....of penalty has been initiated, are completed, or (ii) six months from the end of the month in which the order of the Appellate Assistant Commissioner or the Commissioner (Appeals) or, as the case may be, the Appellate Tribunal is received by the Commissioner, whichever period expires later; (b) in any other case, after the expiration of two years from the end of the financial year in which the proceedings, in the course of which action for imposition of penalty has been initiated, are completed. Explanation.- In computing the period of limitation for the purposes of this section,- (i) the time taken in giving an opportunity to the assessee to be re-heard under the proviso to section 129; (ii) any period during which the im....