COMMISSIONER OF INCOME-TAX Vs. SCIENTIFIC CHEMICALS

JUDGEMENT

(1.) THE following question has been referred at the instance of the Revenue by the Income -tax Appellate Tribunal, Ahmedabad Bench 'C', under Section 256(1) of the Income -tax Act, 1961 ('the Act').

(2.) THE assessment year is 1982 -83. The assessee, a registered partnership firm, was required to file the return of income on June 30, 1982, whereas the same was filed on May 31, 1983. The Income -tax Officer issued notice under Section 274 read with Section 271 of the Act requiring the respondent -assessee to show cause why penalty should not be imposed for late submission of the return. In the order levying the penalty it is stated that since there is no reply from the assessee, it is clear that there is no reason to offer by the assessee -firm. It is further stated that he was therefore satisfied that the assessee has without any reasonable cause failed to file the return in time and thereby, committed default and was liable to penalty. Accordingly, penalty of Rs. 14,730 was levied under Section 271(1)(a) of the Act.

(3.) THE assessee carried the matter in appeal before the Tribunal. The Tribunal, while upholding the findings of the Commissioner of Income -tax (Appeals) on the merits of the matter, cancelled the penalty by its order dated October 12, 1990, holding that the plea of the assessee to the effect that the penalty order was bad in law as the same was passed without application of mind, merited acceptance. It is against this order that the Revenue has come up in reference.