9911796707
TMI Blog1992 (9) TMI 2X X X X Extracts X X X X X X X X Extracts X X X X ..... "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in upholding the order of the Appellate Assistant Commissioner cancelling the penalty orders of the Income-tax Officer under section 271(1)(a) of the Income-tax Act, 1961, relating to the assessment years 1963-64 and 1964-65, on the ground that the penalty orders were illegal and not according to law?" The material facts are only a few. The assessee was a registered firm which committed default in the submission of its return for the aforesaid assessment years, the delay being of 15 months in the submission of the return for the assessment year 1963-64 and of 23 months in the submission of the return for the assessment year 1964-65. The Income-ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reached the conclusion that the Income-tax Officer had committed this illegality, instead of taking necessary proceedings in accordance with law for avoiding this loss of revenue, made an order cancelling the entire penalty imposed by the Income-tax Officer. The Department then went up in appeal to the Income-tax Appellate Tribunal. The Tribunal affirmed the finding of the Appellate Assistant Commissioner about the illegality committed by the Income-tax Officer in computing the penalty which was required to be imposed on the assessee and then it proceeded to say that it had no other alternative except to uphold the order of the Appellate Assistant Commissioner cancelling the penalty imposed by the Income-tax Officer which suffered from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cer cannot be said to be in accordance with law and, therefore, it is not sustainable in law. The penalty imposable in both the assessment years was much higher than the penalty imposed by the Income-tax Officer. It is not disputed before us that the Tribunal has no right to enhance the penalty. The question of law referred to us is also not to the effect whether the Tribunal was justified in not remanding the case to the Appellate Assistant Commissioner after setting aside the orders of the Income-tax Officer by upholding the order of the Appellate Assistant Commissioner cancelling the orders of penalty passed by the Income-tax Officer. The common question of law referred to us is whether the Tribunal was justified in law in upholding the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t figure arrived on that basis on the facts of this case was also indicated. On that conclusion, the only question arising out of the Tribunal's order was whether the Tribunal had no other alternative except to dismiss the Department's appeal and thereby affirm the order of the Appellate Assistant Commissioner cancelling even the lesser penalty imposed by the Income-tax Officer overlooking section 271(2) of the Act. This question related to the power of the Tribunal in deciding the appeals before it. Sub-section (1) of section 254 is as under: " 254. (1) The Appellate Tribunal may, after giving both the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit." The expression "as it thinks fit" is wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1) of the Act covered this aspect. Apart from the fact that the High Court is empowered to reframe a question of law arising out of the Tribunal's order in case the framing of the question is not proper, we have no doubt that the question of law even as framed was wide enough to include this aspect which arises out of the Tribunal's order leading to the reference made to the High Court. The real question of law arising out of the Tribunal's order was : Whether the Tribunal was justified in taking the view that it had no alternative except to uphold the order of the Appellate Assistant Commissioner cancelling the penalty imposed by the Income-tax Officer ? In substance, the question of law referred meant whether the Tribunal was justified ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
