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Assistant Commissioner of Income Tax Versus M/s Vikas WSP Limited And Vica-Versa

2015 (10) TMI 2109 - ITAT DELHI

Penalty u/s 221(1) - outstanding demand on account of self assessment tax - CIT(A) reducing the penalty from 50% to 10% - Held that:- The assessee has paid the entire demand along with interest thereon by 29.03.2012. We are aware that the payment of the entire tax with interest shall not absolve the assessee from penalty provided u/s 221(1) of the Act. However, the penalty imposed u/s 221(1) of the Act should be reasonable considering the facts and circumstances of each case. The CIT(A) has pass .....

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013 - Dated:- 5-10-2015 - G C Gupta, VP And Prashant Maharishi, AM For the Appellant : Shri O P Meena, CIT-DR For the Respondent : Shri Sunil Mathur, ITP ORDER Per Bench These cross-appeals by the Revenue and the assessee for the assessment years 2008-09 and 2009-10 are directed against the order of learned CIT(A), Rohtak dated 2nd May, 2013. These are being disposed of with this consolidated order. 2. The assessee has moved an application for adjournment of the case which was rejected by the Be .....

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, Bhiwani is reasonable, fair and appropriately levied @ 50% of the total demand outstanding on account payment of self assessment tax. The maximum penalty leviable u/s 221(1) of the IT Act is equal to the amount of tax in arrears. 3. On the facts and in the circumstances of the case, the ld.CIT(A) has erred in law in allowing the relief by relying on the decision of Delhi High Court passed in the case of CIT(TDS) Delhi-XVII Vs. Global Infosystems Ltd. [2007] 165 Taxman 486 (Del.). The facts and .....

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. The CIT(A) has erred in not appreciating that the Joint Commissioner of Income Tax, Bhiwani Range, Bhiwani has passed the subject order after duly application of mind and using his discretion in fair and logical way." 4. The grounds of appeal of the assessee for the assessment year 2008-09 are as under:- "1. That the Worthy Commissioner of Income Tax (Appeals), Rohtak has erred in restricting the penalty levied u/s 221(1) to 10% of the outstanding tax demand, which works to ₹ 1 .....

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self assessment tax; levied by the AO u/s 221(1) read with Section 140A(3) of the IT Act, 1961. 2. On the facts and in the circumstances of the case, the ld.CIT(A) failed to appreciate that quantum of penalty levied by the JCIT, Bhiwani Range, Bhiwani is reasonable, fair and appropriately levied @ 50% of the total demand outstanding on account payment of self assessment tax. The maximum penalty leviable u/s 221(1) of the IT Act is equal to the amount of tax in arrears. 3. On the facts and in th .....

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ent of outstanding demand of Self Assessment which was determined by the assessee itself at the time of filing return of income and later on also, assessee defaulted after taking upon itself the responsibility of payment through instalments. 4. The CIT(A) has erred in not appreciating that the Joint Commissioner of Income Tax, Bhiwani Range, Bhiwani has passed the subject order after duly application of mind and using his discretion in fair and logical way." 6. The grounds of appeal of the .....

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DR submitted that learned CIT(A) has grossly erred in reducing the penalty from 50% to 10% of the outstanding demand on account of self assessment tax levied by the Assessing Officer u/s 221(1) read with Section 140A(3) of the Income-tax Act, 1961. He submitted that the maximum penalty leviable u/s 221(1) of the Act was equal to the amount of tax in arrears, whereas the Assessing Officer was reasonable and appropriately levied the penalty on 50% of the total demand and no reason has been given .....

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mp; Co. - [1975] 101 ITR 531 (AP) in support of the case of the Revenue. 8. The learned representative of the assessee has submitted that the assessee has paid the entire demand and has also suffered the interest for late payment thereof and, therefore, should not be visited with penalty u/s 221(1) read with Section 140A(3) of the Act. 9. We have considered the rival submissions and have perused the order of the Assessing Officer and learned CIT(A). We find that the assessee is engaged in the bu .....

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en by the Department were partly honored by the assessee and there were defaults also in making the payment on the due dates as per the installment order. We find that for the assessment year 2008-09, the assessee has paid the entire demand of ₹ 10.46 crores except that of ₹ 1,21,64,826/- before the date of passing of penalty order u/s 221(1) on 17.11.2011. The CIT(A) has recorded that the assessee has paid the entire demand for both the assessment years 2008-09 and 2009-10 along wit .....

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