2003 (4) TMI 13

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....bstantial questions of law are canvassed. "(a) Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is right in law in cancelling the levy of penalty under section 271(1)(a) by holding that the habitual default caused by the assessee has no relevance and would not constitute wilful default? (b) Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is right in law in holding that the criminal court's finding that the assessee is guilty of wilful default and hence punishable under the Income-tax Act has no relevance to the subject matter of appeal before them? (c) Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is right in law in holding ....

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....bunal entertained the appeal though it was delayed and came to the finding that there was reasonable cause for late filing of the return and that the assessee could be let off on the basis of that reasonable cause without penalty. At the outset, it must be said that none of the questions which have been framed in this appeal can be said to be substantial questions of law. After all, under section 271(1)(a), the concerned authority has to come to the conclusion and has to be satisfied that the assessee has without any reasonable cause failed to furnish the returns which he was required to furnish under sub-section (1) of section 139. Therefore, there lies a discretion in the assessing authority or the taxing authorities to appreciate as t....

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....ns were not filed in time. It is also obvious that the returns were filed after about 2 1/2 years and that too after about eight notices having been sent to the assessee. However, while considering the delay, the Tribunal has given a number of reasons. One of the major reasons being that the assessee had closed the business even on May 31,1984, and more importantly the fact that the assessee suffered because of the attitude on the part of its tax consultant. There was an affidavit on record to suggest that the tax consultant and the advocate who was initially looking after the matter did not file the return, partly owing to ill-health and partly owing to the fact that at the relevant time filing of the return depended upon the auditor's rep....

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....on of law and fact and that would never be a substantial question of law. In fact, the Department went to the extent of arguing before the Tribunal that since the assessee was convicted by the Additional Chief Judicial Magistrate, Economic Offences, Ernakulam, and the Additional Sessions Judge, Ernakulam, for deliberately not filing the returns, the Tribunal, in our opinion, rightly has come to the conclusion that the matter would not depend on the findings of the criminal courts and the Tribunal has to independently consider the same. Ultimately, Mr. Ramachandran, the learned senior counsel appearing on behalf of the assessee, reports that even the convictions recorded by the Chief Judicial Magistrate and the Additional Sessions Judge h....