TMI Blog2002 (1) TMI 251X X X X Extracts X X X X X X X X Extracts X X X X ..... is fully supported by the decision of the Hon'ble Allahabad High Court in the case of Rampur Finance Corpn. Ltd. v. CIT [1991] 67 Taxman 162 (All.)." 2. The assessee has preferred Cross Objection No.1 Of 2002 against the same order of the CIT(A) for the same assessment year on the following grounds: "Because the Learned CIT(A) has erred in upholding the validity of the penalty proceedings which had clearly barred by limitation in terms of section 275 of the IT Act. 2. Because the Learned CIT(A) has failed to appreciate that the penalty proceedings had not been validly initiated and hence the entire proceedings were ab initio void." 3. The assessee has filed Cross Objection on 26-12-2001 when the Bench was hearing appeals on tour at Varanasi. However, appeal was filed on 25-1-1996 as per endorsement on the appeal. The learned D.R. objected to the admission of the Cross Objection as it was time barred. Therefore, we have heard the Learned D.R. and the Learned Counsel for the assessee on this point also. It would be appropriate this point be decided first before dealing with the main appeal. 4. The learned D.R. argued that the affidavit explaining the delay has not been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l for the assessee also filed Paper Book containing all the copies of the orders, and replies connected with this case. The Learned Counsel argued on Cross Objection that original assessment order was passed on 24-3-1987 in which no penalty proceedings under section 271(1)(c) were initiated. Against the assessment order, the assessee preferred appeal to the CIT(A) which was decided vide order dated 20-6-1989 and the CIT(A) remanded the case to the Assessing Officer. The assessee filed appeal against the order of the CIT(A) before the I.T.A.T. and the I.T.A.T. decided the appeal vide order dated 29-11-1994. 8. The Learned Counsel for the assessee further argued that fresh assessment order was passed by the Assessing Officer in pursuance of the CIT(A)'s direction vide fresh assessment order dated 16-1-1991 in which for the first time penalty proceedings under section 271(1)(c) were initiated against the assessee. The assessee preferred appeal against the assessment order to the CIT(A) who decided the appeal of the assessee vide order dated 24-8-1992. The Learned Counsel for the assessee further argued that penalty order under section 271(1)(c) was passed by the Assessing Officer o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ticulars were filed before the Assessing Officer. He has further argued that section 41 is not applicable as in earlier years no expenses were claimed. Lastly, he has argued that in similar circumstances, I.T.A.T., Allahabad Bench has allowed the appeal of the assessee for the assessment year 1988-89 and the copy of the order of the Appellate Tribunal has been filed at page 13 of the Paper Book. 11. We have bestowed our careful consideration to the rival submissions of the parties. The facts and dates of the orders mentioned above are almost admitted by both the parties. It is clear from pages 5 and 6 of the Paper Book filed by the assessee that the assessee had been showing the expenses incurred for repairs in Hotel at Jaipur on account of flood and fire in earlier years, which was proved by the United India Insurance Company. Since the claim was not finalised during the years, the repairs and renovations were carried out, the expenditure was out under Suspense Account. The assessee has incorporated all these details in its Balance Sheet and Annual Report and other details, which were filed before the Assessing Officer as well as before the CIT(A). All these details were availa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eduction merely on the basis the accounts are maintained on mercantile basis and that it related to a transaction of the previous year. The Hon'ble High Court, therefore, answered question No. 5 in the negative, i.e. in favour of the assessee and against the Revenue. 11.1 The Hon'ble Patna High Court in the case of Gouri Shankar Suresh Prasad held-- "Tribunal finding that difference arose owing to disallowance of expenditure claimed -- Not a case of concealment of income." 11.2 The Hon'ble Madras High Court in the case of CIT v. S.I. Paripushpam [2001] 249 ITR 550 held- "The Tribunal has found that the Appellate Assistant Commissioner was right in holding that the amount, addition of which was agreed to by the assessee, was an amount which had been set out in an enclosure filed alongwith the assessee's return of income." The Hon'ble Court, therefore, held that the Tribunal was justified in cancelling the penalty levied under section 271(1)(c) of the Income-tax Act, 1961. 11.3 The I.T.A.T., B-Bench, Allahabad in the case of the assessee itself for assessment year 1988-89 vide order dated 29-11-2000 has deleted the penalty in almost similar circumstances. 12. In thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that since in this case the order of the Income tax Appellate Tribunal dated 29-11-1994 was received in the office of the Commissioner on 24-2-1995, therefore, the penalty order was within limitation. He has stressed upon the words "other order'. According to the Ld. DR., the order of the I.T.A.T. has extended the period of limitation in this case. We arc unable to agree with the submission of the Learned D.R. If we accept the view of the Learned D.R., then any appeal or matter, which is pending would extend the period of limitation which would be against the provisions of section 275. The object and purpose of section 275 is to extend the period of limitation in cases where appeals are pending finalisation before the competent lawful authorities. Further the object of the section is that penalty could be imposed on finalisation of the appeals upto the stage of finalisation of appeal before the I.T.A.T. In this case, the order of the I.T.A.T. was passed on 29-11-1994 in which the assessment order dated 24-3-1987 and the order of the CIT(A) dated 20-6-1989 were subject matter. This fact is not disputed by both the sides. It is also not disputed that no penalty proceedings were init ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
