V. S. DHANASEKAR L/H OF LATE V. G. SARAVANA BAVANANDAM v. INCOME TAX OFFICER
[Citation -1984-LL-0829-9]

Citation 1984-LL-0829-9
Appellant Name V. S. DHANASEKAR L/H OF LATE V. G. SARAVANA BAVANANDAM
Respondent Name INCOME TAX OFFICER
Court ITAT
Relevant Act Income-tax
Date of Order 29/08/1984
Assessment Year 1978-79
Judgment View Judgment
Keyword Tags estimate of advance tax • reason to believe • technical default
Bot Summary: The ITO found that on the basis of admitted income or the income ultimately determined after giving effect to the appellate orders the estimate filed by the assessee was under-estimated and called for levy of penalty. The contention of the assessee before us was that the assessee has done its best to arrive at a correct figure of income and there was no motive for filing an under-estimate of advance-tax. In the estimate the assessee has enhanced the income and also shown tax payable at higher figure than that was demanded by the ITO on the basis of latest completed assessment. In the ultimate analysis the tax paid by the assessee was found to be short by Rs. 169 which is too marginal and negligible. The levy of penalty is for the guilt or default in filing an estimate of advance tax which the assessee knew or had reason to believe to be untrue. At best, the assessee can be charged for technical default of paying advance tax less to the extent of Rs. 169. We are satisfied that the assessee had reasonable cause and guilt or default as envisaged in the section was not brought home by the ITO. Accordingly, we set aside the orders of the authorities and cancel the penalty imposed by the ITO which has been partially sustained by the CIT(A).


T.V.K. NATARAJA CHANDRAN, A.M.: In this appeal by assessee issue involved is whether penalty imposed under s. 273(a) of IT Act, 1961 for filing under-estimate of advance- tax is justified or not. ITO found that on basis of admitted income or income ultimately determined after giving effect to appellate orders estimate filed by assessee was under-estimated and called for levy of penalty. Accordingly, he levied penalty of Rs. 2,584. On appeal CIT(A) upheld levy of penalty but on merits he considered that levy of minimum penalty would meet ends of justice. Accordingly, he reduced penalty to Rs. 460 and allowed relief of Rs. 2124. contention of assessee before us was that assessee has done its best to arrive at correct figure of income and there was no motive for filing under-estimate of advance-tax. assessee s representative as well as ld. Departmental Representative have been duly heard. In our view, assessee has complied with demand raised by Department and paid two instalments of advance-tax within time prescribed. assessee also filed estimate of advance-tax within time prescribed and paid tax payable in accordance with estimate within time prescribed by stature. In estimate assessee has enhanced income and also shown tax payable at higher figure than that was demanded by ITO on basis of latest completed assessment. Thus for all intent and purposes assessee has complied with provisions of law. It is only in process of compliance with provisions of law assessee has entertained certain impressions about includibility of income from racing for purposes of estimate of advance tax and also actual extent of income form property as detailed in order of CIT(A). In ultimate analysis tax paid by assessee was found to be short by Rs. 169 which is too marginal and negligible. levy of penalty is for guilt or default in filing estimate of advance tax which assessee knew or had reason to believe to be untrue. preponderance of circumstantial evidence leads to conclusion that assessee acted bona fide in accordance with law and complied with provisions of law to best of his ability. It is by accident that estimate of income and tax paid by him fell short of income ultimately determined and tax payable thereon. ITO has not discharged onus of proving guilt, namely assessee knew or had reason to believe that estimate was untrue. At best, assessee can be charged for technical default of paying advance tax less to extent of Rs. 169. For that purpose penalty cannot be imposed or sustained. We are satisfied that assessee had reasonable cause and guilt or default as envisaged in section was not brought home by ITO. Accordingly, we set aside orders of authorities and cancel penalty imposed by ITO which has been partially sustained by CIT(A). In result, appeal is allowed. *** V. S. DHANASEKAR L/H OF LATE V. G. SARAVANA BAVANANDAM v. INCOME TAX OFFICER
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