TaxTMI 
TaxTMI 
1978 (7) TMI 26
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....on the facts and in the circumstances of the case, the penalty levied by the Income-tax Officer under section 221(1) of the Income-tax Act, 1961, and modified by the Appellate Assistant Commissioner was liable to be cancelled ? The assessee is a private limited company doing business as managing agents. We are concerned in this reference with the assessment year 1965-66, the corresponding previous year being the year ended 31st March, 1965. The order which has ultimately given rise to this reference was an order levying a penalty of Rs. 30,000 (reduced by the AAC to Rs. 20,000) under s. 221(1) of the I.T. Act, 1961, for this assessment year. During the financial year 1964-65 advance tax of Rs. 31,611 was demanded from the assessee und....
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....1(1) of the I.T. Act, 1961. Subsequently on 29th April, 1965, the assessee was allowed to pay the tax by instalments, viz., Rs. 60,000 on or before 30th April, 1965, and the balance in four equal instalments payable on the last day of May, June, July and August, 1965. The penalty of Rs. 30,000 was directed to be paid on or before 30th September, 1965. It had been contended before the ITO that the revised notice of 15th February, 1965, was not valid as the assessee had not paid the full tax under self-assessment for 1964-65 on which self-assessment the revised notice was based by the ITO on 15th February, 1965, on which date the revision was made. In the opinion of the ITO what was relevant was the fact that self-assessment had been made and....
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....rlier, however, reduced the penalty to Rs. 20,000. The matter was then carried further by the assessee to the Tribunal. Before the Tribunal two objections were advanced on behalf of the assessee. It was submitted in the first instance that under the provisions contained in s. 140A(1) the assessee was bound to pay tax payable on the basis of the return (self-assessment) within thirty days of the furnishing of the return. Tax was, therefore, liable to be paid on or before 11th February, 1965. If the full amount of tax had been paid, the assessee would have discharged his liability under s. 140A(1) and the process of self-assessment could have been regarded as being completed. As indicated earlier, the assessee was not in a position to pay ....
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.... the regular assessment or the provisional assessment aforesaid has been made as reduced by the amount, if any, paid in accordance with the original order. The Tribunal then proceeded to consider the requirements of s. 210(3) and expressed the opinion that the tax which was required to be paid was naturally the full tax and not a part of the tax is suggested by the departmental representative. This was the plain meaning of the provision and in the view of the Tribunal there was no reason why the plain meaning should be abandoned and some other construction substituted in its place. The Tribunal also asked itself the question as to whether there could be any, basis for such a provision and found the answer in the provisions of s. 140A whi....