TMI Blog1979 (9) TMI 42X X X X Extracts X X X X X X X X Extracts X X X X ..... 2) of the Act, the Appellate Tribunal was justified in cancelling the fine levied by the Commissioner of Income-tax ? " The assessee had entered into a contract with the Reserve Bank of India for a sum of about Rs. 5 lakhs on March 27, 1967, for the construction of a building for it at Hyderabad. The assessee did not furnish the particulars as per the provisions of s. 285A(1) read with r. 120 of the I.T. Rules. The Commissioner initiated proceedings for the levy of fine under s. 285A(2) and issued a show-cause notice to the respondent-assessee as to why he should not be proceeded against under s. 285A(2). The assessee made oral submissions through its advocate and also filed written explanation to the effect that the omission to furnish t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h is quasi-criminal i nature and, therefore, default per se will not expose the assessee to fine as the department has failed to prove criminal intent or contumacious conduct or deliberate intention on the part of the assessee to disregard the statutory provisions and, therefore, allowed the appeal. The application filed by the department under s. 256(1) of the Act was rejected by the Tribunal on the ground that no question of law arises out of the order of the Tribunal. Hence, this reference under s. 256(2) of the Act. Sri P. Rama Rao, the learned counsel for the revenue, contended that the Tribunal erred in law in holding that fine imposable under s. 285A(2) of the Act is quasi-criminal in character and it cannot be levied unless the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ormation is really necessary for the purpose of proper computation of the income of such contractors as per the provisions of the Act. This obligation has to be discharged by the class of contractors referred to in s. 285A(1). This requirement is not applicable to contractors, the value of whose contract for carrying out any work or for the supply of goods or services is less than Rs. 50,000. It is only in the case of big contractors, where the value of the contract for carrying out any work or for the supply of goods or services or both exceeds Rs. 50,000, that the concerned person is obliged to furnish the particulars as required under s. 285A(1). Sub-section (2) of s. 285A of the Act empowers the Commissioner to impose upon any contracto ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ". It cannot be said that it is mandatory on the part of the Commissioner to invariably impose fine in each and every case where there is default in complying with the provisions of s. 285A(1) by any contractor. The Commissioner has to exercise the power vested in him under sub-s. (2) to s. 285A in a judicious, fair and proper manner, and not arbitrarily or whimsically. The discretionary power being statutory in character, he cannot impose the fine arbitrarily or unreasonably. The very fact that no minimum amount of fine is fixed indicates that free discretion is given to the Commissioner, who is the highest officer of the department in the State, to exercise the power properly and judiciously taking into account the facts and circumstance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry provision. It is enacted with a view to safeguard the interests of the public regarding trust money. The offence in question is punishable only with fine. The conviction under that does not, carry any stigma. The language of the provision appears to make its contravention an absolute liability. Under these circumstances, we think the offence mentioned in that section is an absolute one. Consequently we cannot read into it the requirement of mens rea. This decision supports the view expressed by us. The language of s. 295A makes its contravention an absolute liability. We may refer to a decision of a Full Bench of this court in Addl. CIT v. Dargapandarinath Tuljayya Co. [1977] 107 ITR 850, wherein it was held that where the statute ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e may be liberal in imposing some nominal fine depending on the circumstances of the case. However, it is open to him to impose fine in cases where the omission or default was deliberate or mala fide. With regard to the quantum of the fine, the Commissioner has to exercise his discretionary power fairly, reasonably and judiciously. In view of the finding of the Commissioner that the omission or default on the part of the assessee in this case, being the first of its kind and the omission not being deliberate or mala fide, we feel it just and proper to hold that the Tribunal has to consider, on merits, whether this is a fit case for the levy of fine and if it is a fit case to levy fine, what is the amount of fine to be levied. The Tribunal h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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