1992 (10) TMI 13

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.... J.-This reference made under section 256(1) of the Income-tax Act, 1961, at the instance of the Revenue, in respect of the assessment years 1963-64, 1964-65 and 1968-69, refers the following question for the opinion of this court : "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was correct in cancelling the penalties levied by the Income-tax Officer under s....

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....ise of his power under section 221(1) of the Act. The assessee's appeals to the Appellate Assistant Commissioner failed. The Tribunal noticing that the expression "tax" has been separately defined in section 2(43) of the Act and also relying on a judgment of the Calcutta High Court in Shreeniwas and Sons v: ITO [1974] 96 ITR 562, cancelled the penalties levied under section 221(1) of the Act. On t....

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...."tax". The expression "tax" has been defined in section 2(43) of the Act as under : "2. In this Act, unless the context otherwise requires,-... (43) `tax' in relation to the assessment year commencing on the 1st day of April, 1965, and any subsequent assessment year means income-tax chargeable under the provisions of this Act and in relation to any other assessment year income-tax and super-....

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....s that, despite an order made by him requiring the assessee to pay up the amounts of penalty levied under section 271(1)(c) of the Act, the assessee had failed, and, therefore, the assessee was in default in payment of tax. In our view, the Tribunal was fully justified in cancelling the penalties by reading the expression "tax" used in section 221 as defined in section 2(43) of the Act. The Cal....