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TMI Blog1997 (8) TMI 95X X X X Extracts X X X X X X X X Extracts X X X X ..... solved. Thereafter, on 3rd March, 1989, the assessee filed revised return for the period 1st July, 1985 to 31st Jan., 1987, declaring total income of Rs. 80,33,527. The assessment was finalised under s. 143(1) on 30th March, 1989, accepting the income offered by the assessee. According to the AO, in asst. yr. 1987-88, the assessee was entitled to make payment of advance tax under s. 211 of the IT Act upto 15th Dec., 1986, or upto 31st March, 1987. The assessee has made the following payments towards advance tax: . . . Rs. . 12-12-86 1987-88 8,60,800 Advance tax 14-12-87 1987-88 8,14,498 Advance tax 1-3-89 1987-88 2,36,510 Self asst. tax 12-6-87 1988-89 2,245 Advance tax . . 19,14,053 . According to the AO, the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich the assessee is in appeal before us. . The learned counsel on behalf of the assessee has filed a paper book annexing therein Form No. 29 filed by the assessee regarding estimate of advance tax for asst. yr. 1988-89. A copy of revised statement of total income was also filed along with the paper book. It was submitted on behalf of the assessee that the penalty has been imposed by the AO on the basis of presumption. Our attention was drawn to the finding recorded by the AO while levying penalty. It was submitted that assessee was not at all aware about the dissolution of the firm which had taken place on 31st Jan., 1987. Therefore, the finding of the AO that the assessee could have filed higher estimate including the additional period f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ingly, for 1987-88 assessment year, the accounting year was 1st July, 1985 to 30th June, 1986. This firm was dissolved on 28th Feb., 1987. In normal course, income for the period from 1st July, 1986 to 28th Feb., 1987, would have been shown in 1988-89 assessment year and accordingly, the appellant did file such estimate for 1988-89 assessment year and had paid advance tax accordingly for 1988-89 assessment year. In fact, the total advance tax paid for the period for which the income was ultimately assessed, is Rs. 16,77,537 as against income of Rs. 19,14,568 as assessed covering the entire period. (5) It would be obvious from the above that the assessee did pay more than 75 per cent of the assessed tax by way of advance tax but that such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsider the submission made by the assessee. On the other hand, the CIT(A) confirmed the penalty order on the basis of surmises and conjecture. 4. On the other hand, the learned Departmental Representative supported the orders passed by the authorities below and submitted that in view of the amendment made in s. 273(2)(c) w.e.f. 1st Sept., 1986, there is no question of considering any reasonable cause for failure to furnish and estimate of advance tax as required under law. Therefore, the order passed by the authorities below should not be disturbed. 5. We have heard both the sides and also perused the materials available on record. In the present case original return was filed on 30th July, 1987, for the period from 1st July, 1985 to 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e termed as mala fide. It is true that as pointed out by learned Departmental Representative by way of amendment w.e.f. 10th Sept., 1986, the word "without reasonable cause" has been omitted from the provision of s. 273(2)(c). However, as rightly pointed out by learned counsel on behalf of the assessee that on the same day the provision of 273B had been introduced according to which no penalty is leviable on an assessee if he proves that there was a reasonable cause for the failure. Therefore, in our opinion, the assessee has succeeded to make out a reasonable cause for the failure. Therefore, in our opinion, the assessee has succeeded to make out a reasonable cause in the present case. Accordingly, we direct the AO to cancel the levy of pe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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