C.I.T. vs. M/S B.S.INTERNATIONAL

ITR/122/1995HC Punjab & HaryanaPHHC01032177199527 October 2006Author: MR. JUSTICE RAJESH BINDAL,MR. JUSTICE ADARSH KUMAR GOEL2 pages
AI SummaryAllowed

What did the High Court hold?

The High Court held that the issue was covered against the revenue by its earlier judgment in Income-Tax Officer v. Kaysons India (2000) 246 ITR 489. The Court reasoned that section 271B applies to a default or failure to file the return along with the audit report on or before the specified date. In the case of Kaysons India, it was observed that the default for which the penalty was levied was not covered by section 271B. The revenue had not contended that the assessee failed to get accounts audited or obtain the audit report before the specified date. Furthermore, no return had been filed under section 139(1) or in response to a notice under section 142(1), meaning there was no default in furnishing an audit report along with a non-existent return. The return under section 139(1) could be filed up to November 30, 1990. The assessee filed a return on December 31, 1990, under section 139(4), which was duly accompanied by the audit report obtained under section 44AB. Therefore, the default was not covered by section 271B, and the CIT(A) and the Tribunal were justified in holding that no penalty was leviable. The question of law is answered against the revenue and in favour of the assessee.

What were the facts?

The Commissioner of Income-tax, Jalandhar (the Revenue) has filed an Income Tax Reference (ITR) No. 122 of 1995 before the High Court of Punjab and Haryana at Chandigarh. The reference arises from an order dated 21.04.1993 passed by the Income Tax Appellate Tribunal (ITAT), Amritsar Bench, in I.T.A. No.902(ASR)/1992. The assessment year in question is 1989-90. The dispute concerns a penalty of Rs. 50,230 levied under section 271B of the Income-tax Act, 1961, which was cancelled by the Commissioner of Income-tax (Appeals) and subsequently confirmed by the ITAT. The High Court is asked to decide a question of law referred by the ITAT.

What were the issues?

1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in confirming the CIT(A)'s order cancelling the penalty of Rs.50230/-, which had been levied under section 271B of the Income-tax Act, 1961 in respect of assessment year 1989-90? Assessee's Contention: The judgment does not record specific arguments made by the assessee before the High Court. However, the reasoning of the High Court implies that the assessee contended that the penalty under section 271B was not leviable. Revenue's Contention: The revenue contended that the penalty under section 271B was rightly levied. The judgment does not explicitly detail the revenue's arguments but refers to the High Court's previous judgment in Income-Tax Officer v. Kaysons India (2000) 246 ITR 489, which addressed similar issues.

Which sections of the Income-tax Act were involved?

Section 271B,Section 44AB,Section 139(1),Section 139(4),Section 142(1)

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. I.T.R. No.122 of 1995 Date of decision: 27.10.2006 The Commissioner of Income-tax, Jalandhar. -----Applicant Vs. M/s B.S. International, Jalandhar. -----Respondent CORAM:- HON'BLE MR JUSTICE ADARSH KUMAR GOEL HON'BLE MR JUSTICE RAJESH BINDAL Present: Dr. N.L. Sharda, Advocate for the revenue. -----

ORDER: Following question of law has been referred for opinion of this Court by the Income Tax Appellate Tribunal, Amritsar Bench, Amritsar, arising out of its order dated 21.04.1993 in I.T.A. No.902(ASR)/1992 in respect of assessment year 1989-90:- “Whether, on the facts and in the circumstances of the case, the Tribunal was justified in confirming the CIT(A)’s order cancelling the penalty of Rs.50230/-, which had been levied under section 271B of the Income-tax Act, 1961 in respect of assessment year 1989-90.” We find that the issue stands covered against the revenue by the judgment of this Court in Income-Tax Officer v. Kaysons India (2000) 246 ITR

489.

After considering the relevant provisions, this Court observed at page 492:- “It is, therefore, evident that the default or failure to file the return along with the audi

The order continues below.

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