TMI Blog2004 (12) TMI 15X X X X Extracts X X X X X X X X Extracts X X X X ..... NA. JUDGMENT The judgment of the court was delivered by R.K. Agrawal J.- The Income-tax Appellate Tribunal, Allahabad has referred the following questions of law under section 256(2) of the Income-tax Act, 1961, hereinafter referred to as "the Act", for opinion to this court: "1. Whether, on the facts and in the circumstances of the case, the penalty under section 28(1)(c) has rightly been cancelled by the Tribunal? 2. Whether, on the facts and in the circumstances of the case, the Tribunal is justified in ignoring the reasonable cause for inordinate delay in imposing penalty under section 28(1)(c) and in holding that the case of the assessee falls within the purview of the decisions of the hon'ble High Court in the case of Ram K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer for about 20 years and, therefore, the respondent-assessee was entitled to claim cancellation of the penalty imposed. As there was a difference of opinion, the matter was referred to the Third Member. The Third Member dealt with the different aspects of the matter and agreed with the view expressed by the Judicial Member to the effect that for the inordinate delay there was no explanation and, therefore, the penalty has rightly been cancelled. The Tribunal has passed the order in conformity with the opinion expressed by the Third Member and had upheld the order passed by the Appellate Assistant Commissioner cancelling the penalty. We have heard Sri Shambhoo Chopra, learned standing counsel appearing for the Revenue and Sri V.K. Up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that no adverse inference can be drawn on account of the mere so called inordinate delay in the imposition of the penalty. Learned counsel appearing for the respondent, however, submitted that the assessment order having been passed on March 28, 1956, and the penalty order having been passed on December 7, 1976, there was an inordinate delay of more than 20 years and, therefore, the Tribunal has rightly upheld the order passed by the Appellate Assistant Commissioner cancelling the penalty. He submitted that reliance placed by learned counsel for the Revenue on the various proceedings, which did not relate to the respondent, would not come to his rescue for explaining the delay. He further submitted that the Tribunal had not committed any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C 122; [1988] (2) JT 320 (SC), the apex court has held that in the absence of any prescribed period of limitation, the assessment has to be completed within a reasonable period. What such reasonable period would be, would depend upon the facts of each case. In the case of Ram Kishan Baldeo Prasad v. CIT [1967] 65 ITR 491, this court has held that even though no period of limitation has been prescribed for imposing a penalty, and a penalty in respect of the assessment year 1945-46 could have been imposed in August, 1957, propriety required the changed circumstances to be taken into consideration and the responsibility for the inordinate delay should be considered and fastened before levying the penalty or upholding it. This court had also ..... X X X X Extracts X X X X X X X X Extracts X X X X
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