TMI Blog1981 (10) TMI 59X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee for the years under consideration, the ITO completed the assessment as detailed below: -------------------------------------------------------------------------------------------------------------------------------------------------- Year of Date of Total income Date of Total assessment filing returned by assessment income return the assessee by the ITO assessed for the year -------------------------------------------------------------------------------------------------------------------------------------------------- 1958-59 26-10-1969 29,492.06 28-12-1961 33,864 1959-60 18-11-1960 50,463.22 30-6-1962 51,001 1960-61 31-1-1961 47,611.00 30-8-1962 60,749 1961-62 29-9-1962 56,060.07 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in a latter part of this order by observing as under : "The learned representative of the appellant has filed before me a copy of the settlement petition reached with the department covering the assessment years 1958-59 to 1967-68 in terms of which the department and the assessee will pray for setting aside the order pending before the appellate authorities, in order to give effect to the terms of the settlement. The appellant, accordingly, prays that this assessment be set aside." Coming to the accounting period relevant to the assessment year 1959-60, we find that application of the assessee under section 146 to set aside the ex parte assessment of the assessee for that year was rejected by the ITO. Thereafter, the assessee had filed an appeal before the AAC challenging the correctness of the order of the ITO rejecting the said application under section 146. This appeal of the assessee as also the appeal of his against the quantum of total income determined in the reassessment under section 144/147(a) was dismissed by the AAC. Against those orders, the assessee brought the matter by way of appeals before the Tribunal (Calcutta Bench 'C') bearing IT Appeal Nos. 1012 (Cal.) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pursuant to the reopening of the reassessment under section 146 had been allowed as mentioned in para 4 above. 6. At this stage, we will like to state that the assessee and his brother Shri P.K. Neotia, had made an application dated 29-3-1966, much after the completion of the aforesaid original assessments or the assessee for the years under consideration, under section 271(4A) wherein they had made voluntary disclosure of income not disclosed but shown as cash credits in various firms as detailed therein totalling Rs. 2,77,823.25. The said application was rejected by the Commissioner, W.B. II, Calcutta, vide his letter dated 2-4-1969. Therein, the Commissioner had informed the assessee that if he so desired he could come up with a settlement petition which would be considered on merits. This led to the making of the settlement petition by the assessee and his brother---leading to the settlement as contained in the terms and conditions for agreed assessments between the assessee and his brother on one hand and the Commissioner, W.B. V, Calcutta, dated 30-3-1974 (a copy of the said terms and conditions for agreed assessments are at pages 12 to 15 of the paper book filed by the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year 1961-62 and sustained by the ITAT. The benefit of deduction sought for against (i) above cannot be allowed as no such prayer was made either in the disclosure petitions dated 29-3-1966 or in the settlement petitions submitted in 1969. Since the benefit claimed has arisen out of an afterthought and the addition was reached its finality the assessee's request in this respect is not entertainable. As regards (ii) above, since the addition of Rs. 10,000 made in the assessment of M/s Greekay Transport Corporation for the year 1961-62 represents bogus loan in the name of M/s Jain Finance Distributors (India) (P.) Ltd. on 30-3-1961 before the peak was reached (vide Annexure 'A') and it has been sustained in appeal, the assessee's request in this respect is conceded to avoid taxation of the same amount twice over. 5. The amount of Rs. 3,04,986 (Rs. 2,55,000-Rs. 10,000+Rs. 4,053+Rs. 22,823+Rs. 33,110) will be assessable in the following assessment years: --------------------------------------------------------------------------------------------------------------------------------------------------- Assessment Amount of Interest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll be payable by the assessees at 20 per cent of the tax sought to be avoided. 11.1 To give effect to the terms of this settlement the assessments of the assessees and those of the firms mentioned before will be reopened, rectified or modified under section 146/147/154 or 264, as the case may be. The department and the assessees will pray for setting aside the orders pending before the appellate authorities, viz., AAC or ITAT, in respect of the appeals of the assessees and the said firms pertaining to the loans and interest covered by this settlement. 11.2 The ITO will concede before the AAC/Tribunal to the reduction of the amount of penalty under section 271(1)(c), if any, in terms of this settlement. 11.3 The assessees and/or the said firms will not press before the appellate authorities for any relief other than what has been settled in this agreement, i.e., with regard to loans and interest covered by this agreement. 13. Matters not covered by this agreement will be disposed of in accordance with law. With regard to non-filing or delay in filing of returns in response to notices under section 139(2)/148 or under the corresponding section of the Indian Income-tax Act, 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 22,500 ---------------- 56,364 ---------------- 1959-60 88,735 (a) Business income as per original assessment 51,001 (b) 50 per cent share as per settlement order 33,734 ---------------- 81,735 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1,09,944 ---------------- On the basis of these returns, the ITO completed the reassessment of the assessee for the years under consideration accepting the incomes returned, vide reassessment orders dated 30-11-1974. 8. Prior to the completion of the reassessments referred to in the immediately preceding paragraphs, the ITO issued show cause notices to the assessee as to why penalties be not levied against him under section 271(1)(c) for each of the said years under consideration for having concealed the particulars of his income and/or furnishing inaccurate particulars thereof. These notices for all the years under consideration were issued on 27-11-1974 and were served on the assessee on 7-12-1974. It appears that on the latter fresh notices were issued by the ITO under section 271(1)(c)/274 for all the years under consideration on 22-2-1977 for showing cause against the said penalties fixed for 28-2-1977 (sic). It was recorded that "ITO did not hear the case as files transferred to IAC who will hear t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here is any pre-existing relationship between the parties or not. To buttress the arguments that the assessee having been not aggrieved from the penalty orders, as these penalty orders are in accordance with the terms and conditions of the agreed settlement between the Commissioner and the assessee, and so these appeals by the assessee were not competent, the departmental representative has relied on the following decisions : CIT v. Army Navy Stores Ltd. [1957] 31 ITR 959 (Bom.), Jivatlal Purtapshi v. CIT [1967] 65 ITR 261 at page 267 (Bom.), M. N. Annaiah v. CIT [1970] 76 ITR 582 at page 586 (Mys.), Ramanlal Kamdar v. CIT [1977] 108 ITR 73 at page 75 (Mad.), CIT. v. Ram Kumar Agarwalla Bros. [1977] 108 ITR 457 at page 461 (Cal.), CIT v. Chrestian Mica Industries Ltd. [1977] 109 ITR 324 at page 332 (Cal.), India Sea Foods v. CIT [1978] 114 ITR 124 (Ker.) and Banta Singh Kartar Singh v. CIT [1980] 125 ITR 239 (Punj. Har.). 10. According to the senior departmental representative Mr. Ghosh, since the penalty orders have been passed in accordance with the terms and conditions of the settlement between the Commissioner and the assessee, the procedure followed in the matter of le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs under consideration are concerned, each of the said penalty orders is a nullity because the IAC levied the penalty against the assessee for those years without following the principle of natural justice, inasmuch as, the IAC levied the penalty without giving an opportunity of being heard to the assessee against the proposed penalty orders and the assessee can challenge these penalty orders in these appeals filed by him. Mr. Agarwalla has further urged that there cannot be an estoppel against law. In support of these arguments, Mr. Agarwalla has relied on the following decisions---Shaik Ibrahim v. CIT [1968] 69 ITR 117 at page 120 (AP), B.B. Bamsi v. CIT [1972] 83 ITR 223 (Bom), Continental Commercial Corpn. v. ITO [1975] 100 ITR 170 (Mad.), Shakuntala Mehra v. CWT [1976] 102 ITR 301 at page 308 (Delhi), Mariam Aysha v. C Ag. IT [1976] 104 ITR at page 384 (Mad.), Chhat Mull Aggarwal v. CIT [1979] 116 ITR 694 at page 697 (Punj. Har.), Addl. CIT v. P. Nammalvar Naidu Sons [1979] 116 ITR 863 at page 867 (Mad.), Rathnam Co. v. IAC 1980 124 ITR 376 at page 379 (Mad.), Ferozilal Jain v. Man Mall AIR 1970 SC 794 at page 2327 (Vol. 2), Asstt. Custodian v. Brij Kishore Agarwala 1971 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... commission under which the court/authority is constituted and may be extended or restricted by the like means. A limitation may be (1) as to the subject-matter ; (2) as to the person ; (3) as to the pecuniary value of the suit ; or (4) as to place or it may partake of two or more of these characteristics. 14. Taking the limitation as to the subject-matter, we like to mention that subject-matter depends upon the nature of the cause of action and the relief prayed for. Take for example, a Presidency/Provincial Small Cause Court has no jurisdiction to entertain certain suits, e.g., suits for recovery or partition of immovable property, suits for the foreclosure or redemption of a mortgage of immovable property, etc. To say in other words, these types of suits are excepted from the cognizance of Presidency/Provincial Small Cause Court. If a Presidency/Provincial Small Cause Court agreed to entertain a suit, which is excluded from its cognizance, its decree is a nullity. We say so because it is a fundamental rule that a judgment of a court without jurisdiction is a nullity: "Where by reason of any limitation imposed by statute, charter, or commission, a court is without jurisdictio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ought, and their Lordships do not doubt that, in such a case, a defendant may be barred, by his own conduct, from objecting to irregularities in the institution of the suit. But when the judge has no inherent jurisdiction over the subject-matter of a suit, the parties cannot, by their mutual consent convert it into a proper judicial process, although they may constitute the judge their arbiter, and be bound by his decision on the merits when these are submitted to him. But there are numerous authorities which establish that when in a cause which the judge is competent to try, the parties without objection join issue, and to trial upon the merits, the defendant cannot subsequently dispute his jurisdiction upon the grounds that there were irregularities in the initial procedure, which, if objected to at the time, would have led to the dismissal of the suit." 16. The above principles laid down in Ledgard v. Bull were illustrated by their Lordships of the Privy Council in Meenakshi Naidu V. Subramania Sastri [1887] 14 IA 160. That was a case in which the High Court of Madras had entertained an appeal from an adjudication from which no appeal was provided for by any enactment. Their L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for all the flats and the plaintiffs, therefore, claimed the full rent of the premises from the middle of that year. The claim was allowed because the court took the view that the period for which the full rent was claimed fell outside the representation. The matter reached the King's Bench and Mr. Justice Denning, as he then was, considered obiter whether the plaintiff could have recovered the covenanted rent for the whole period of the lease and observed that in equity the plaintiffs could not have been allowed to act inconsistently with their promise on which the defendants had acted. It was pressed upon the Court that, according to the well settled law, being laid down in Jorden v. Money [1854] IR 5 HL Cas 185 (HL), no estoppel could be raised against the plaintiff since the doctrine of estoppel by representation is applicable only to representations as to some state of facts alleged to be at the time actually in existence and not to the promises de futuro which, if binding at all, must be binding only as contracts and here there was no representation of an existing state of facts by the plaintiffs but it was merely a promise or representation of intention to act in a particula ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a policy decision in January 1970, that new vanaspati units will be given only a graded partial concession during the first three years of production and once again the State Government revised its policy in August 1970, rescinding even the partial exemption. In the meantime, the appellant had written a letter to the effect that it would be availing of the partial exemption. The appellant thereupon filed a writ petition which it amended and in the amended petition raised the plea that the Chief Secretary, acting on behalf of the State Government, had given an unequivocal assurance that the appellant would be entitled to exemption from payment of sales tax for a period of three years from the date of commencement of production, intending or knowing that it would be acted upon by the appellant, and the appellant, relying on that assurance, established the factory by investing a large amount, and, therefore, the State Government was bound to honour the assurance and exempt vanaspati manufactured and sold by the appellant for a period of three years from July 2, 1970. The High Court rejected the plea." 20. On appeal to the Supreme Court, their Lordships of the Supreme Court reversed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee and, in fact, the promisee, acting in reliances on it, alters his position, the Government would be held bound by the promise and the promise would be enforceable against the Government at the instance of the promisee, notwithstanding that there is no consideration for the promise and the promise is not recorded in the form of a formal contract as required by article 299 of the Constitution. Since the doctrine of promissory estoppel is an equitable doctrine, it must yield when equity so requires. If it can be shown by the Government that having regard to the facts as they have subsequently transpired, it would be inequitable to hold the Government to the promise made by it, the court would not raise all equity in favour of the promisee and enforce the promise against the Government, because, on the facts, equity would not require that the Government should be held bound by the promise made by it. When the Government is able to show that in view of the facts which have transpired since the making of the promise, public interest would be prejudiced if the Government were required to carry out the promise, the court would have to balance the public interest in the Government carry ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry estoppel cannot be applied in the teeth of an obligation or liability imposed by law. Promissory estoppel cannot be invoked to compel the Government or even a private party to do an act prohibited by law. There can also be no promissory estoppel against the exercise of legislative power. The Legislature can never be precluded from exercising its legislative function by resort to the doctrine of promissory estoppel. Their Lordships also went on to observe that if the U.P. Sales Tax Act did not contain a provision enabling the Government to grant exemption, it would not be possible to enforce the representation against the Government, because the Government cannot be compelled to act contrary to the statute ; but since section 4A or the U.P. Sales Tax Act, 1948, confers power on the Government to grant exemption from sales tax, the Government can legitimately be held bound by its promise to exempt the appellant from payment of sales tax. It is true that taxation is a sovereign or governmental function, but no distinction can be made between the exercise of a sovereign or governmental function and a trading or business activity of the Government, so far as the doctrine of promissor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mount of income (as determined by the Income-tax Officer on assessment) in respect of which the particulars have been concealed or inaccurate particulars have been furnished exceeds a sum or twenty-five thousand rupees, the Income-tax Officer shall refer the case to the Inspecting Assistant Commissioner who shall, for the purpose, have all the powers conferred under this Chapter for the imposition or penalty." A perusal of this provision makes it abundantly clear that the IAC will have the jurisdiction over the subject-matter of a penalty proceeding if and only if the amount of income (as determined by the ITO on estimate) in respect of which the particulars have been concealed or inaccurate particulars have been furnished exceeds the sum of Rs. 25,000 ; otherwise not. To say in other words, the condition precedent for involving the jurisdiction of the IAC in penalty proceedings will be that the amount of income in respect or which particulars have been concealed or inaccurate particulars have been furnished exceeds a sum or Rs. 25,000. If that much quantum of income concealed, etc., is not there, there is inherent lack of jurisdiction in the IAC to impose a penalty against the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is levied in accordance with the aforesaid settlement between the Commissioner and the assessee as detailed in para 6 above, is irrelevant. We cannot agree with this proposition canvassed by the departmental representative, Mr. A.K. Ghosh, before us. The order to be a valid order must be passed by authority competent to pass it. If that authority lacks inherent jurisdiction to pass a penalty order like the one involved herein, then the principle of promissory estoppel will not make an order of such authority to be a valid one, when, in law, the order by an authority having no inherent jurisdiction is one which does not exist in law, being a nullity. We hold likewise. The Tribunal in these appeals can go into this part of the case of the assessee. 25. We next come to the penalty order by the IAC against the assessee for the assessment year 1959-60. As for the other three years, the ITO for this year, i.e., assessment year 1959-60, had issued a show cause notice to the assessee dated 22-2-1977 as to why penalty be not levied against him under section 271(1)(c). As in the case of other three years, the hearing against the show cause notice issued to the assessee for the assessment y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , however, levied the penalty for the assessment year 1959-60 without giving an opportunity to show cause to the assessee as to why penalty under section 271(1)(c) be not levied against him for having allegedly concealed his income or furnishing inaccurate particulars of his income for the year. In law, as laid down in the following authorities relied upon by the representative for the assessee, Mr. G.P. Agarwalla, it was incumbent on the IAC before the levy of penalty for the assessment year 1959-60 to issue the said show cause notice or give an opportunity of hearing to the assessee and it is a case where due to that irregularity in the exercise of jurisdiction, the penalty order of the IAC under section 271(1)(c) for this year (assessment year 1959-60) becomes invalid in law and not a nullity on account of inherent lack of jurisdiction as seems to be the case of the assessee in course of the arguments before us---Banarsi Das v. CIT, M. Chockalingam M. Meyyappan v. CIT, CIT v. Narang Co., Tarula Shyam v. Ag. ITO and C. Ag. IT v. Smt. P. Parukutti Amma. The present case for the assessment year 1959-60 is a case of irregular exercise of jurisdiction and not inherent lack of ju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a reasonable opportunity of being heard. Rather, this provision supports our above conclusion. 27. Having come to the above conclusions that the penalty orders by the IAC for the assessment years 1958-59, 1960-61 and 1961-62 are nullity, on account of lack of inherent jurisdiction by the IAC to levy penalties against the assessee under section 271(1)(c), in view of the provisions of section 274(2) and that the penalty order under section 271(1)(c) against the assessee for the assessment year 1959-60 was invalid and not a nullity on account of irregular exercise of jurisdiction by levying the penalty without giving an opportunity of hearing to the assessee in the shape of show cause notice, we next address ourselves to the question as to whether we should quash the penalty proceedings, as argued before us very vehemently by the representative for the assessee, Mr. G.P. Agarwalla, or whether we should send the matters back to the ITO for the assessment years 1958-59, 1960-61 and 1961-62 and to the IAC for the assessment year 1959-60, so as to reconsider these proceedings from the stage where the illegality stepped in for the assessment years 1958-59, 1960-61 and 1961-62, i.e., at t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dings were validly started by the ITO, the order of the AAC setting aside the first order of the ITO and to restore the matter to him for deciding it afresh after giving due opportunity of hearing to the assessee was correct. In that case, there was no question of any annulment of the first order of the ITO. Further, the same very ITO, who did not give any opportunity of being heard, carried on the proceedings. Coming to the other case reported as CIT v. National Taj Traders, the question before the Supreme Court was whether the order of remand passed by the Commissioner in accordance with the direction of the Tribunal, although beyond the period of limitation prescribed, by the Act, was valid or not. The Supreme Court on these facts has held that since the order was passed by the Commissioner pursuant to the order of the Tribunal, the period of limitation did not apply. 30. G.P. Agarwalla further urged that in none of these two cases the Court had sent back the cases to an authority other than the one who had exercised the jurisdiction initially. In the cases under consideration before the Tribunal, the impugned penalty orders for the assessment years 1958-59, 1960-61 and 1961-6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce the aforesaid illegality and irregularity have intervened, after the ITO and the IAC had correctly assumed jurisdiction, it would be in the fitness of things that instead of quashing these penalty orders, we should only set aside these penalty orders and restore the penalty proceedings to the ITO for the assessment years 1958-59, 1960-61 and 1961-62 to proceed from the stage at which the penalty proceedings stood at the stage immediately after the issue of the show cause notice to the assessee as to why penalty be not levied against him, under section 271(1)(c) and prior to 28-2-1977 when he did not proceed further with the penalty proceedings and to restore the penalty proceedings to the IAC for the assessment year 1959-60 to proceed from the stage prior to the passing of the levy of penalty order when he should have issued a show cause notice to the assessee as to why penalty be not levied against him, under section 271(1)(c). We are taking this course because these cases are cases where the penalty proceedings were validly initiated by the competent authority concerned and the penalty orders have become nullity/invalid on account of the intervention of the illegality/invalidi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce was issued. The ITO had jurisdiction to continue the proceedings from the stage at which the illegality had occurred. The ratio of this decision fully supports our above view. This view also finds support from the decision of the Tribunal (Calcutta Bench 'D') relied on by the departmental representative. 32. We now come to the other decision relied on by the senior departmental representative, in CIT v. National Taj Traders. The facts in that case are that on or about 5-8-1960, the respondent-assessee submitted voluntary returns, inter alia, for the assessment years 1957-58 and 1958-59 along with a declaration dated 8-8-1960. The assessments of the respondent-assessee for the assessment years 1957-58 and 1958-59 were completed on 12-8-1960 by the ITO on total income of Rs. 7,000 and Rs. 7,500 and the same having been made in the status of unregistered firm consisting of three partners, viz., Asha Devi Vaid, Santosh Devi Vaid and Sugni Devi Vaid with equal shares. On 2-8-1962, the Commissioner issued a notice to show cause to the assessee-respondent as to why the said assessments should not be cancelled under section 33B of the Act as he felt that the completed assessments were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elating to the vacating of the Commissioner's order and the other relating to the giving of a direction to him to dispose of the case under section 33B afresh after giving due opportunity to the assessee and the High Court held that in exercise of its appellate powers the Tribunal acted property in directing him to dispose of the case afresh under section 33B(1) because the period of limitation of two years prescribed under section 33B(2)(b) for him to act under section 33B(1) had expired and answered the question accordingly. 36. The revenue challenged the order of the High Court on this aspect of the second question before the Supreme Court and the Supreme Court upheld the view of the Tribunal. This decision is, therefore, an authority for the proposition propounded by the senior departmental representative which has been duly upheld by us. 37. We now come to the decision of the Calcutta High Court relied upon by the representative for the assessee, i.e., Jaswanta Rai v. ITO. The facts in that case are as follows : In the assessment of the assessee for the assessment year 1962-63, the ITO had recorded that the assessee-firm was guilty of furnishing inaccurate particulars and/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uthority. The jurisdiction of a court or an authority is generally determined with reference to the point of time when the court or authority takes decision of the matter or the case, subject to any contrary provision in the statute or the authority. Accordingly, assumption of jurisdiction by the IAC, Range-V, Calcutta in place of IAC, Range-IV, Calcutta, to whom the penalty proceedings were validly referred by the ITO, A Ward, Distt. III(3), Calcutta was illegal and so the notice issued by him to the IAC, Range V, Calcutta was quashed. This decision is clearly distinguishable, more so when the question as to whether the IAC of IT Range-IV, Calcutta, to whom the reference was validly made by the ITO, A Ward, Distt. III(3), Calcutta, could restart the penalty proceedings from the stage prior to the transfer of the penalty proceedings to the IAC, Range V, Calcutta, does not appear to have examined and decided in this case. 38. We, therefore, in view of our discussions, subject to what we are going to state hereinafter, set aside the impugned penalty orders by the IAC, Range-VII, Calcutta dated 31-3-1977 for the assessment years 1958-59, 1960-61 and 1961-62 and restore the penalty p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hosh, who, on the strength of the following decisions, has very strenuously urged that the IAC, if he has had initially the inherent jurisdiction, would not lose the power to impose the penalty after 1-4-1976 in a case where he has validly assumed the jurisdiction prior to 1-4-1976 merely because the provisions of section 274(2) stand omitted with effect from 1-4-1976 by the Taxation Laws (Amendment) Act, 1975: 1. The Calcutta Bench 'A' in IT Appeal No. 1010 (Cal.) of 1977-78 in the case of Shri Bhabesh Chandra Mukherjee decided on 16-9-1978, to which one of us (the J.M.) was a party, at pages 26 to 31 of the paper book filed by the ITO. 2. CIT v. Eastern Development Corpn. 5 CTC 33, copy whereof is at pages 32 to 35 of the paper book filed by the Deptt. (Calcutta High Court); and 3. CIT v. B.P. (India) Ltd. [1979] 116 ITR 440 at pages 450-51. 40. We have given consideration to the above arguments. The decisions of the Calcutta High Court relied upon by the senior departmental representative on the point at issue are binding on us. Respectfully following the said decisions of the Calcutta High Court, which approved the aforesaid decision of the Tribunal (Calcutta Bench 'A') ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e orders pending before the appellate authorities, viz., AAC or ITAT in respect of the appeals of the assessees and the said firms pertaining to the loans and interest covered by this settlement. 11.2 The ITO will concede before the AAC/Tribunal to the reduction of the amount of penalty under section 271(1)(c), if any, in terms of this settlement." From the orders of the Tribunal for the assessment years 1958-59 and 1959-60 at pages 22 to 25, we find that these penalty orders were set aside by the Tribunal on the request made by the assessee. In view of the aforesaid term 11.1 and in the light of the said term 11.2, the assessee had requested for the penalty orders for those two years to be cancelled. It was pursuant to the request by the assessee that the penalty orders were cancelled and this was in accordance with term 11.1 and the terms and conditions of the aforesaid settlement between the Commissioner and the assessee. That being the position, the assessee cannot now turn round to say that the authority concerned cannot pass fresh penalty orders for which reference is sought to be made by the authority concerned in view of the terms and conditions of the aforesaid settlem ..... X X X X Extracts X X X X X X X X Extracts X X X X
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