TMI Blog2015 (2) TMI 409X X X X Extracts X X X X X X X X Extracts X X X X ..... , particularly when the Tribunal had accepted that the assessee has not discharged onus to explain its default, are insufficient to infer a legal exercise of discretion to determine the quantum of penalty. The impugned order, therefore, does not meet the parameters of a judicial, much less a quasi judicial determination. The appeals are, therefore, partly allowed, the assessee's exigibility to penalty is affirmed but the quantum of penalty determined by the Tribunal is set aside and the appeals are restored to the Tribunal for adjudication afresh and in accordance with law so as to determine the quantum of penalty to be imposed upon the appellants. - ITA Nos.134 and 135 of 2014, ITA Nos.95 and 119 of 2014 - - - Dated:- 16-1-2015 - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A brief narrative of the facts, would be appropriate. The Assessing Officer issued notices for assessment years 2008-09 and 2009-10, requiring the assessee to show cause why penalty under section 140-A(3) of the Act, read with section 221 of the Act be not imposed as the assessee did not deposit taxes before filing the return. In response, the assessee pleaded paucity of funds for its inability to deposit tax by the due date. The Assessing Officer imposed a penalty of ₹ 65,71,450/- for assessment year 2009-10 and ₹ 66 lacs for assessment year 2008-09. Aggrieved by this order, the assessee filed an appeal. The CIT (Appeals) set aside the order in its entirety by holding that paucity of funds prevented the assessee for depositing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year 2008-09 and 2009-10. Thus applying the liberal interpretation, we restrict the levy of penalty in the case to ₹ 10 lacs each for the financial year 2007-08 and 2008-09. Accordingly, we direct the Assessing Officer to restrict the penalty levied under section 140A(3) read with section 221(1) of the Act at ₹ 10 lacs each. The grounds of appeal, thus, raised by the revenue are partly allowed. The assessee has, as recorded in the opening paragraph of the judgment, given up a challenge to exigibility to penalty and, therefore, the questions, as agreed by counsel for the parties, that require an answer are (a) whether quantum of penalty can be determined without referring to relevant factors and assigning adequate reasons? ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... followed by a perceptible process of reasoning, leading to a fair and just conclusion. A few factors which, in our considered opinion, may be relevant, though not be exhaustive of the circumstances that may be taken into consideration are:- (a) the period of default; (b) the reasons for default; (c) the recurring nature of the default; (d) conduct of the assessee and (e) any extenuating circumstances putforth by the assessee. The Tribunal did not take into consideration any relevant fact or factor but by merely using a few legal phrases, reduced the penalty from 66/60 to 10 lacs each. The discretion conferred to determine the quantum of penalty, is judicial in nature and may if the facts and factors so warrant, be more or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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