Rajasthan High Court - Jaipur
Commissioner Of Income-Tax vs Adu Ram on 14 September, 1988
Equivalent citations: [1989]175ITR324(RAJ)
Author: J.S. Verma
Bench: J.S. Verma
JUDGMENT
1. This is a reference under Section 256(1) of the Income-tax Act, 1961, ("the Act"), at the instance of the Revenue to answer the following question of law :
"Whether, on the facts and in the circumstances of the case, the Tribunal was justified legally in holding that no penalty under Section 271(1)(a) of the Income-tax Act, 1961, is leviable in the case of the asses-see, a registered firm, because it had no tax liability in terms of the Explanation to Section 271(1)(a) and that the provisions of Section 271(2) did not govern the field in this case ?"
2. The relevant assessment year is 1978-79. The question as well as the facts on which this question arises is the same as in CIT v. Builders Engineers Co. [1989] 175 ITR 317 (Raj). Following that decision and for the same reasons, this reference has to be answered in the negative.
3. Consequently, the reference is answered against the Revenue and in favour of the assessee by holding that the Tribunal was justified in taking-the view that no penalty under Section 271(1)(a)(i)(b) of the Act is leviable against the assessee, a registered firm, because it had no tax liability within the meaning of the expression "assessed tax" given in the Explanation to Sub-clause (i)(b) of Clause (a) of Sub-section (1) of Section 271.
4. No costs.