TMI Blog1980 (7) TMI 3X X X X Extracts X X X X X X X X Extracts X X X X ..... r the following question of law for the opinion of the court : " Whether, on the facts and in the circumstances of this case, the cancellation of the penalty of Rs. 27,700 (Rupees twenty-seven thousand seven hundred) was legal and proper? " For the assessment year 1966-67, the assessee, a limited company, filed a return showing a sum of Rs. 19,407 as the income, on which the tax assessable wou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der imposing penalty. Thereafter, the present reference was called for at the instance of the Department. Learned counsel appearing on behalf of the Department has stated that in view of the fact that the Explanation to s. 271(1)(c) of the Act was attracted, the Tribunal has erred in relying on the decisions reported in CIT v. Anwar Ali [1970] 76 ITR 696 (SC) and Hindustan Steel Ltd. v. State of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of s. 271 of the Act reads as follows: " Where the total income returned by any person is less than eighty per cent. of the total income (hereinafter in this Explanation referred to as the correct income) as assessed under section 143, or section 144, or section 147 (reduced by the expenditure incurred bona fide by him for the purpose of making or earning any income included in the total income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of CIT v. Parmanand Advani [1979] 119 ITR 464 (Pat.), our own High Court also held the same view. After the addition of the Explanation, above-quoted, with effect from April 1, 1964, the position in this respect has changed and the decision in the cases of Anwar Ali [1970] 76 ITR 696 (SC) and Hindustan Steel Ltd. [1972] 83 ITR 26 (SC), have no application. Therefore, the question is answered ..... X X X X Extracts X X X X X X X X Extracts X X X X
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