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2016 (6) TMI 800

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..... bservation that the assessee has paid the taxes even before the issue of the notice by A.O. u/s 221(1) of the Act and complied the tax demand voluntarily. We find that the assessee has not paid taxes which are payable along with a return of income, however paid within a month even before the notice issued by the A.O. and the assessee complied the demand of tax voluntarily. Under these above facts and circumstances of the case, it is not a fit case to impose penalty u/s 221(1) of the Act. - Decided in favour of assessee - I.T.A. No. 533/Vizag/2014 - - - Dated:- 6-5-2016 - Shri V. Durga Rao, Judicial Member And Shri G. Manjunatha, Accountant Member For the Appellant : Shri G.V.N. Hari, AR For the Respondent : Shri Govinda Rajan, .....

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..... of ₹ 1,14,73,950/- for the Assessment year 2012-13 we submit you as stated below. 1. A copy of the Notice u/s 221(1) of the Income Tax Act, 1961 dated 25.10.2012 received on 30.10.2012 together with our explanation letter dated 30.10.2012 submitted in this regard are enclosed. The Form No.26AS downloaded from the website where from the tax payments can be verified. In this regard, we submit that we have paid of the complete self assessment tax due ₹ 1,14,73,950/- even before the notice u/s 221(1) has been received by us on 30.10.2012 and within one month after filing the return of income on 29.9.2012 for the Asst year 2012-13. We also submit that we are highly vigilant about the tax in arrears and have cleared the tax due .....

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..... in arrears at the earliest. The assessee paid the balance taxes immediately after accumulation of funds within a month of filing of the return of income, that too, even before the issue of notice u/s 221(1) of the Act voluntarily. With the above observation, he has scaled down the penalty imposed by the A.O. from 100% to 10% and the appeal of the assessee is allowed partly. On being aggrieved, assessee is in appeal before the Tribunal. 4. The Ld. Counsel for the assessee has submitted that due to nonavailability of the funds, the assessee is not in a position to pay the taxes immediately. However, after receiving the funds from the customers, dues were paid within a month that too even before the issue of the notice u/s 221(1) of the Act .....

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..... 6191/Mum/2011 by order dated 15.1.2014 has observed that where there was reasonable and sufficient cause for not making a payment of self assessment tax at the time of filing of the return of income, no penalty u/s 221 of the Act was warranted. 8. In another case, ITAT Bombay Tribunal in the case of Jehangir Lentin Estates Pvt. Ltd. Vs. ITO (2014) 63 SOT 0067 Mumbai (URO), wherein Tribunal has observed that penalty u/s 221(1) of the Act shall not be levied when good and sufficient reason is given for default in payment of tax. Assessee has a bonafide intention to pay the tax and statutory liabilities. 9. Keeping in view of the facts and circumstances of the present case and also by following the judicial precedents, we are of the opin .....

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