TMI Blog1992 (8) TMI 109X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs. 8,06,542 thereon. This estimate was considered to be falling within the mischief of s. 273(2)(aa) of the Act as the total income assessed under s. 143(3) on 28th March, 1988 amounted to Rs. 25,26,490 which, on appeal, was reduced to Rs. 24,44,700, as could be seen from the revised order passed under s. 251 on 21st Sept., 1988. Before completing the assessment, the ITO had initiated penalty proceedings under s. 273(2)(aa) of the Act and called upon the assessee to show cause against the levy of penalty. As there was no response to the said show cause notice, which was fixed for hearing on 27th Sept., 1989 the ITO presumed that the assessee had no explanation to offer. He, therefore, concluded that the estimate of advance tax filed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome assessed worked out to Rs. 24,14,173. The CIT was of the view that unless there was a finding that the claim for depreciation on cylinders had been made deliberately to lower the income for purposes of advance tax, it could not be said that the estimate filed was low within the meaning of s. 273(2)(aa) under s. 209A(4) of the Act, as the amount of depreciation could not be included for calculating the liability. The CIT held that in the absence of any such findings, the levy of penalty under s. 273(2)(aa) of the Act was not justified and accordingly, cancelled the same. This is being objected to by the Revenue in the present appeal before the Tribunal. 5. Shri Chatterjee for the Revenue argued that as the difference between the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same and that the imposition of penalty was justified as the returned income was Rs. 17,88,520, whereas the income estimated for purposes of advance tax was Rs. 14,50,000. 8. I have carefully considered the contentions of parties in the light of the materials placed before me. In my view, the decision of the CIT(A) cancelling the penalty imposed under s. 273(2)(aa) of the Act is correct and has to be upheld for the following reasons. 9. Under s. 273(2)(aa), a penalty is leviable if an assessee has furnished under s. 209A(4) or under s. 212(3A) an estimate of advance tax payable by him which he knew or had reason to believe to be untrue. In the present case, the ITO had stated that the estimate of advance tax furnished by the assessee un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he ITO at the assessment stage. The very fact that the assessee's claim has been accepted by the Tribunal shows that it is a bona fide claim put forward by the assessee. Therefore, there could be no question of treating the estimate filed by the assessee under s. 209A(4) of the Act on 15th Dec., 1984 as one which the assessee knew or had reason to believe to be untrue. The burden of proving this as per the case law is entirely on the Revenue and not on the assessee. This is now well settled by the decision of the Calcutta High Court in the case of CIT vs. Birla Cotton Spinning Weaving Mills Ltd. In this decision, their Lordships have held as follows, as could be seen from the head note which is quoted below, at pages 448 and 449 of the Re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... between the income returned and the income estimated by the assessee. What the assessee is called upon to explain here is the disparity between the income assessed finally and the income estimated by it for purposes of advance tax. The facts of the case show that the assessee had made an honest estimate of its advance tax liability, but that at the time of the assessment the Departmental authorities did not accept a portion of its claim for depreciation which was finally accepted by the Tribunal on appeal by the assessee. It, therefore, follows that there could be no penalty on the facts of the present case as I find, there was a reasonable basis for the assessee's estimate of advance tax as the income returned by it has been finally accep ..... X X X X Extracts X X X X X X X X Extracts X X X X
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