TaxTMI 
TaxTMI 
2022 (7) TMI 544
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....the Dy. Commissioner of Income Tax-9(3)(2), Mumbai (The Learned Assessing Officer) was confirmed. 02. Assessee has raised following grounds of appeal:- "1. BECAUSE, the ld. CIT (A) has erred in law and on facts while upholding the penalty of Rs. 1, 84, 60,000/- u/s 221(1) of the Act on alleged default in payment of self-assessment tax. 2. BECAUSE, the ld. CIT(A) has erred in law and on facts in failing to appreciate that the appellant was not an 'assessee in default' u/s 140A so as to be liable for impugned penalty. 3. BECAUSE, the ld. CIT(A) has erred in law in failing to consider that even an "assessee in default u/s 140A was not liable to penalty u/s 221 after the amendment w.e.f. 01.04.1989. ....
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....786/- and balance tax liability was worked out at Rs.7,39,71,026/-. Thus, the additional tax liability of Rs.3,69,29,000/- was paid on 5th July, 2017 of Rs.2,70,00,000/- and on 15th December, 2017, Rs.99,20,000/-. 08. However, on 23rd March, 2018, the learned Assessing Officer issued notice under Section 221 read with section 140A of the Act, asking the assessee as to why the penalty should not be levied for default of non-payment of taxes on due date. 09. On 24.04.2018, assessee submitted that there is no default as the self-assessment tax as determined in the return of income under Section 139(4) of the Act has been paid. 010. The learned Assessing Officer rejected the contention of the assessee and on 14 May 2018 passed an order....
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.... the issue decided by Special Bench in case of Claris Life sciences Limited vs. DCIT in ITA No. 498/AHD/2011 dated 26 September 2017. Accordingly, he levied the penalty of Rs.1,84,60,000/- being 50% of Rs.3,69,20,000/- by passing an order under Section 221(1) of the Act on 14th May, 2018. 011. Assessee aggrieved with that order preferred an appeal before the learned CIT (A), who confirmed the same by order dated 31 January 2020 and therefore, assessee is in appeal before us. 012. The learned Authorized Representative submitted paper book containing 69 pages placing on record the factum of filing of original return of income as well as return filed under Section 139(4) of the Act. It is specifically referred to page no. 64 of the Paper....
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....t' and therefore, the penalty levied by learned Assessing Officer and confirmed by learned CIT (A) is not correct. She submitted that the return filed by the assessee under Section 139(4) of the Act does not have any default of the payment of tax. No penalty has been initiated based on return filed under Section 139(4) of the Act. Accordingly, penalty is required to be deleted. 013. The learned Departmental Representative supported the orders of the lower authorities. He submitted that originally the assessee has filed return of income claiming wrong minimum alternative tax credit, wherein it was found by the Department that such credit is erroneous, and certain columns were not filled, the notice was given to it as defective return. Ass....
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....t rectified then such return shall be treated as an invalid return and the provisions of this act shall apply as if the assessee has failed to furnish the return. If before the assessment is made, assessee rectified the defect, the AO may condone the delay and treat the return is a valid return. In case of the assessee, assessee did not rectify that defect of incorrect claim or filing of proper schedules, therefore, the original return filed by the assessee on 17/10/2016 is deemed never to have been filed. The fact also shows that assessee subsequently filed the return of income u/s 139 (4) of the act which is a valid return. In the acknowledgement of return produced before us placed at page number 54 of the paper book shows that it is an o....