COMMISSIONER OF INCOME TAX Vs. USHABH METALS LTD.

JUDGEMENT

(1.) THE respondent -company appeared through Shri Daya Chand, its director, to submit that on account of the poor financial condition of the assessee -company, the Court may provide free legal aid to it. We, accordingly, requested Shri Prakash Kumar, advocate, to appear for the respondent -company as an amicus curiae and to assist the Court. Mr. Kumar has, after going through the order of the Division Bench of this Court, passed in a batch of cases, i.e., ITA 205/2001 and others, entitled CIT vs. Aditya Chemicals and Ors. [reported at (2005) 197 CTR (Del) 241 - -Ed.] fairly conceded that the questions that were raised in this appeal for the determination of this Court stand answered by the said judgment in favour of the Revenue. A reading of the said decision shows that the Court had formulated the following two questions for determination :

(2.) THE questions were then answered in the following words :

(3.) IN the light of the above, we have no difficulty in holding that the CIT(A) as also the Tribunal were both in error in deleting the penalty imposed on the company under s. 271(1)(c) of the IT Act, 1961, merely on the ground that the total income of the assessee has been assessed at a minus figure/loss. We further hold that CIT(A) and the Tribunal were not justified in holding that the judgment in CIT vs. Prithipal Singh & Co. (1990) 85 CTR (P&H) 26 : (1990) 183 ITR 69 (P&H) and CIT vs. Prithipal Singh and Co. (2001) 166 CTR (SC) 187 : (2001) 249 ITR 670 (SC) would apply even after fresh disposal on merits in accordance with law.