TaxTMI 
TaxTMI 
2018 (4) TMI 1271
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.... OF PENALTY UNDER SECTION 221(1) OF THE INCOME TAX ACT, 1961, AMOUNTING TO Rs. 7,88,986/-. 1. On the facts and in the circumstances of the case, the Commissioner of Income Tax (Appeals), hereinafter referred as the CIT (Appeals), has erred by not deleting the penalty of Rs. 7,88,986/- levied by the Assessing Officer, on the ground that the Self Assessment Tax for the A.Y.2009-10 was not paid before filing the return of Income. 2. The learned CIT (Appeals) failed to consider the financial crisis faced by the appellant company. Further, the learned CIT (Appeals) failed to appreciate that the appellant company has made payment of total self assessment tax within the time allowed by the Assessing Officer. Also, the learned CIT....
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.... letter dated 15.03.10 by submitting that assessee is engaged in the business of trading in gem studded jewellery which is passing through a very difficult time due to recession world over. As a result the profitability of the business was reduced enormously affecting the overall cash flow of the company. The assessee also submitted that arrangement is being made to pay the entire outstanding demand along with interest for which four post dated cheques were issued in favour of the revenue to be paid in four installments by 29.03.10. The contentions of the assessee did not find favour with the AO and he rejected the submissions of the assessee by observing that no evidences to prove the financial stringencies have been filed and finally impo....
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....view of the aforesaid facts and in the absence of any will supported reasonable cause and the fact that the Assessing Officer has levied 25% penalty, I find no further scope to interfere in the penalty order passed by the Assessing Officer dated 22.03.2010. 6. The Ld. A.R. vehemently submitted before us that due to global recession in the gems and jewellery industry the business of the assessee was impacted adversely and as a result financial position of the assessee became very stressed as the assessee was into the business of manufacturing gems and studded jewellery and exporting the same. Due to the overall recession in the international market the liquidity position of the company became from bad to worse and recovery from the debtor....
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....TR 45 (Karn.) 7. On the other hand, the Ld. D.R., relied heavily on the order of authorities below and submitted that the assessee could not prove before the authorities below that its financial position was so bad that even the taxes could not be paid before filing the return. The Ld. D.R. submitted that the assessee failed to pay the advance taxes on the specific dates and ultimately showing huge amount of tax outstanding to the tune of Rs. 31,55,945/- which remained unpaid even the return of income was filed. The Ld. D.R. contended that the assessee has completely failed to make out any prima-facie case to show their financial stringencies in the business of the assessee and it is only after committing the default by way of non paymen....
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....tement as reproduced below: Statement showing funds f low during the period of October 2009 to March 2010 Inflow during the month Outflow during the month Balance October 6,272,441 6,683,052 (410,611) November 16,165,237 61,736,495 (45,571,257) December 19,850,924 21,927,511 (2,076,587) January 15,211,976 15,512,193 (300,217) February 19,981,183 19,269,270 711,913 March 27,947,327 31,030,627 (3,083,300) Mimansa Jewellery Private Limited Cash Flow Statement 1-10-2009 to 31-03-2010 Particulars Amount Amount Bank Balance as on 1-102009 852,418 Add: Receipts Receipts from Debtors 97,681210 ....