ACIT, C-5(1), CHANDIGARH vs. M/S VENUS REMEDIES LTD., PANCHKULA

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ITA 1530/CHANDI/2018Status: DisposedITAT Chandigarh20 November 2019AY 2012-133 pages
AI SummaryDismissed

What did the Tribunal hold?

The CIT(A) deleted the penalty, invoking the second proviso to Section 221(1), finding that the default was due to good and sufficient reasons. The Tribunal upheld the CIT(A)'s order.

What were the facts?

The Assessing Officer levied a penalty for non-payment of self-assessment tax and interest. The assessee argued that it faced a severe financial crunch, with funds utilized for loan and tax payments.

What were the issues?

Whether the penalty for non-payment of self-assessment tax was justified when the assessee demonstrated financial difficulties and sufficient reasons for the default.

Which sections of the Income-tax Act were involved?

Section 221(1)

AI-generated summary — verify with the full judgment below

आदेश/Order

Per Sanjay Garg, Judicial Member:

The present appeal has been preferred by the Revenue against the order dated 28.09.2018 of the Commissioner of Income Tax-2, Chandigarh [hereinafter referred to as ‘CIT(A)’] agitating the action of the Ld. CIT(A) in deleting the penalty u/s 221(1) of the Income Tax Act, 1961 (in short 'the Act') levied by the Assessing Officer.

ITA No. 1530/Chd/2018- M/s Venus Remedies Limited, Manimajra 2 2. The Assessing Officer levied the impugned penalty for non-

payment of self-assessment tax along with interest. However, the

assessee submitted before the Ld. CIT(A) that the assessee was in heavy

financial crunch. He demonstrated before the Ld. CIT(A) that its funds

were utilized in payment of loans and taxes. Though, the Assessing

Officer in the impugned order had observed that the assessee earned

sufficient profits in the subsequent years, however, the assessee

demonstrated before the Ld. CIT(A) that all the profits earned by the

assessee were got utilized in payment of outstanding liabilities. The

assessee despite of financial difficulties was able to run the business.

3.

Considering the submissions of the assessee which were

corroborated with the accounts of the assessee, the Ld. CIT(A) invoking

the second proviso to section 221(1) of the Act deleted the impugned

penalty observing that the default on the part of the assessee was on

account of good and sufficient reasons.

4.

Being aggrieved by the above order of the CIT(A), the Revenue

has come in appeal before us.

5.

We, after considering the rival contentions of the Ld. Authorized

Representatives of both the parties and having gone through the

material available on record, find that the Ld. CIT(A) has discussed and

ITA No. 1530/Chd/2018- M/s Venus Remedies Limited, Manimajra 3 deliberated upon the issue, and we do not find any infirmity in the order of the CIT(A), the same is therefore, upheld.

In the result, the appeal of the Revenue stands dismissed.

Order dictated and pronounced in the Open Court immediately on completion of hearing.

Sd/- Sd/- (अ�नपूणा� गु�ता / ANNAPURNA GUPTA) (संजय गग� / SANJAY GARG) लेखा सद�य/ Accountant Member �या�यक सद�य/ Judicial Member

Dated : 26.11.2019 “आर.के.” आदेश क� ��त�ल�प अ�े�षत/ Copy of the order forwarded to : 1. अपीलाथ�/ The Appellant 2. ��यथ�/ The Respondent 3. आयकर आयु�त/ CIT 4. आयकर आयु�त (अपील)/ The CIT(A) 5. �वभागीय ��त�न�ध, आयकर अपील�य आ�धकरण, च�डीगढ़/ DR, ITAT, CHANDIGARH 6. गाड� फाईल/ Guard File

आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar

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