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Commissioner of Income Tax V/s Chandra Sekhar
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Commissioner of Income Tax  V/s Chandra Sekhar
Commissioner of Income Tax V/s Chandra Sekhar

Facts

This appeal has been filed before the Supreme Court pursuing the order of dismissal passed by the Honorable High Court of Andhra Pradesh in matter of filing the Income Tax Return, whereby an appeal has been made to set aside the order of the High Court. The respondent herein is also an assesse and a partner in the M/S Manik Rao and Brothers. As per the compliance of the provision of the tax laws he filed the income tax returns for the assessment year 1959 to 1960, 1960 to 1961, 1961 to 1962 and 1962 to 1963 he filed all these returns on the date 2nd of August, 1963 but at the same time he did not filed the return for the assessment year 1963 to 1964, whereas such return was filed by the partner/ respondent on the date 2nd August, 1964. The Income Tax department filed a charge against the assesse believing that such filing of the return is at the fault of the assesse, the official imposed penalty under the income tax act for delayed filing of the return, the penalty imposed was under section 271 sub-sections 1 under clause 2. The appellant filed the submissions in Appellate Assistant Commissioner of Income Tax contending that the return furnished by the appellant were for four years before the assessment year under section 139(4) of the Income Tax Act, 1961 and thus the appellant is not liable for any penalty.  The assesse made the submission that the interest has been levied under the provision of the Income Tax Act therefore the department is not liable to charge the penalty to the ass esse. As the department has already levied the interest on the assesse up to the date of the return filed so it was presumed that the department has already anticipates and accepted the return under the provision of extension of filing the return with the authority. The appellant made the prayer to the Appellate Tribunal that any person authorized with judicial and quasi-judicial authority such person should act and oblige himself with integrity and according to the provision of law.           

Issues

  1. Whether the penalty levied upon the assesse stands valid?
  2. Is the return filed by the assesse in violation of the provision of the law?

Court Observation

The Supreme Court stating its observation said that if it is clear that there arises a penalty whereby the provision states to penalize the person for any reason he believes that there is a delayed filing with regards to the Income Tax returns. The person will be allowed to take comfort within the reason provided in a time limit for filling such return under section 139(1) of the Income Tax Act. The Court also has the reason to believe that the Act provides the thorough power to the tax officer to provide the extension of the filling period for the tax return filing. The parliament had expressed power and opportunity to provide in the Act by way of proviso or amendment the exact date of filing the return if any by the same proviso it should’ve authorized the officials for deciding over the extension of the same period if the reason specified deems fit. The Court observed that if there’s extension provided by the officer relying upon the proviso provided by the statute made enforceable by the Parliament, it should have understood or it should be understood by nay assesse as the time period for the payment, filing, and for any reason that arises as an obstacle regarding the tax liability should be resolved within the same time. The Court furthers states that the time period provided by the tax officer will have a statutory effect as per the Tax laws provided and he should have statutory authority under such provision. For furnishing the return it constitutes an integral part of the time allowed for furnishing the return. So when the time extended for any purpose by the tax officer then all the time up to that date will be included for any delayed purpose to repair, any additional time excluding the time extended or from due date will be included for a clear interpretation of the provision under section 271 (a). The Court lies a clear understanding that considers the provision under the tax laws and facts to be considered in the above matter there is no pint of law where it attracts a penalty towards the appellant.

Judgment

The Supreme Court further agree in deciding the matter in favour of the appellant, by considering the earlier order by the Honorable High Court, it states the decision by the earlier court satisfy the objective and should be confirmed. The decision of the High Court stands confirmed and a question raised by the learned counsels are dismissed by the High Court which this Court finds a right fit. All the appeals filed before the court stands dismissed.

Case No.: CA of 1299 – 1303 of 1973

Date: 04/12/1984

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