TaxTMI 
TaxTMI 
1997 (6) TMI 24
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....irst respondent completed the assessment of the petitioner-firm by order dated February 24, 1988. Exhibit P-1 is a copy of the assessment order as per which income was fixed at Rs. 4,72,750. However, by exhibit P-3 order exhibit P-1 order was rectified and the correct interest payable under section 139(8) of the Act was determined as Rs. 1,06,395 as against Rs. 37,086 demanded originally. The petitioner filed a petition before the Commissioner under section 273A of the Act for waiver of interest levied under sections 139(8) and 217 for the assessment year 1984-85. That revision petition was dismissed by the Commissioner as per exhibit P-5 order dated March 1, 1991. Again the petitioner filed exhibit P-6 petition to review the order passed b....
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....of any tax or interest payable in consequence of an order passed under this Act in respect of the relevant assessment year. Explanation 1.--For the purposes of this sub-section, a person shall be deemed to have made full and true disclosure of his income or of the particulars relating thereto in any case where the excess of income assessed over the income returned is of such a nature as not to attract the provisions of clause (c) of sub-section (1) of section 271. " Counsel for the petitioner places reliance on clause (iii) of sub-section (1) of section 273A which authorises the Commissioner to reduce or waive the amount of interest paid or payable under sub-section (8) of section 139 or section 215 or section 217 or the penalty imposed ....
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....ed basis on the ground that the assessee was not keeping proper bills and vouchers. Thus, in view of this addition the officer could have levied penalty under clause (c) of sub-section (1) of section 271. But it is pertinent to note that the officer had not levied any penalty as contemplated in clause (c) of sub-section (1) of section 271 of the Act. That means, the excess income assessed over the income returned by the assessee is of such a nature as not to attract the provisions of clause (c) of sub-section (1) of section 271. The result is that the assessee shall be deemed to have made full and true disclosure of his income in respect of the year 1984-85. But the Commissioner while passing exhibit P-5 did not examine the applicability of....
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.... the facts and circumstances of this case, there was no full and true disclosure of the income by the assessee." On the other hand, standing counsel for the Income-tax Department relies on the decision of the Supreme Court in Smt. Harbans Kaur v. CWT [1997] 224 ITR 418. That was a case where the Commissioner of Wealth tax indicated his own reasons for resorting to the power of reduction of penalty in preference to the granting of waiver of the full penalty. The conclusion of the court was where the conditions of section 18B are satisfied, the Commissioner of Wealth-tax has discretion either to waive or to reduce the penalty and the Commissioner had indicated his own reasons for resorting to the reduction of penalty in preference to giving....