TMI Blog1982 (11) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... e-tax Rules. The assessee failed to do so. On the other hand, he supplied to the ITO requisite information only on 6-9-1980, i.e., after a delay of 1220 days. Under the circumstance, the Commissioner initiated against the assessee proceedings for penalty under section 285A(2). The only plea raised by the assessee before the Commissioner was that the aforesaid contract was the first contract entered into by the assessee and that he was not aware of the legal requirement as to furnishing of information in prescribed proforma as aforesaid. The learned Commissioner took the view that unawareness of the legal provisions was not sufficient defence. The Commissioner held that though maximum penalty could be imposed in the form of fine of Rs. 44,55 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e by the assessee. The ITO had in the said order also noticed that tax had been deducted at source by the other party, with whom the assessee had entered into contract. We are, therefore, inclined to believe that after the date of filing the return for the assessment year 1978-79, the assessee could have no motive in hiding from the ITO concerned the fact about the contract. The date of filing of the return is not available. The penalty imposed by the learned Commissioner gives an approximate rate of Rs. 1.65 per day. We, therefore, direct that penalty should be so reduced as to apply fine of Rs. 1.65 per day for the period from 24-4-1977 to the date of filing of the return of total income for the assessment year 1978-79. The assessee gets ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s provisions were highly complicated. 6. Again it was a small matter. The ITO has passed the assessment order accepting the returned income of Rs. 4,750 and had observed that it was a 'petty' case. The whole order of the ITO comprised of 5 lines and it reads as under : "Return showing an income of Rs. 4,750 has been filed. Only source of income disclosed by the assessee is contract business. Total payments received have been shown at Rs. 47,459. This appears to be a petty case as such assessment is completed under section 143(1). Issue ND and refund voucher after properly verifying the payment to IDS in Government account." It was, thus, admittedly a petty case. It cannot be considered that each assessee, whether small or big, must ru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ormation. This shows that he had not considered the information to be very necessary. The levy of the penalty has to be seen in the background of all these facts. The Commissioner had levied a penalty of Rs. 2,000 which was almost 50 per cent of the total income earned by the assessee. My learned brother has directed while reducing the penalty, that penalty be levied for the period April 1977 to the date of the filing of the return, for the reason that after the filing of the return, the assessee could have no motive in hiding from the ITO concerned the fact about the contract. I am, however, of the view, with respect, that such a motive could not have been there even earlier as tax had been deducted at source and even otherwise, it was a v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ver, he supplied to the ITO information on 6-9-1980. The Commissioner initiated proceedings against the assessee for levy of fine under section 285A. The assessee pleaded that this was the first time that the assessee entered into a contract and he did not know the legal formalities regarding furnishing of information. The Commissioner rejected the plea and imposed fine of Rs. 2,000. 3. The assessee came up in appeal and he appeared in person. The learned Judicial Member held that the penalty is leviable at Rs. 1.65 per day for the period from 24-7-1977 to the date of filing of the return of total income. On the other hand, the learned Accountant Member held that no penalty was leviable. According to him, the ITO completed the assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... first time took up a contract. He was not being assisted by any professional people. He was a college student till recently. He filed a return. The tax was deducted at source when the Government paid him the money. The assessment was completed and the refund was actually due to him. The plea that the assessee was not aware of the legal requirements cannot be brushed aside and he be made liable to a fine on the ground that ignorance of law is no excuse. The old theory that ignorance of law is no excuse does not hold good in view of the complexity of laws in modern days. It is impossible for any one let alone well informed people to know all the technicalities of law. A mere breach of law which is venial in character will not lead to the inf ..... X X X X Extracts X X X X X X X X Extracts X X X X
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