CIT Vs. GANESHI LAL RAM KRISHNA

JUDGEMENT

(1.) THE Income Tax Appellate Tribunal, Allahabad, has referred the following questions of law under section 256(l) of the Income Tax Act, 1961 (hereinafter referred to as the Act) for opinion to this Court: 'Whether, on the facts and in the circumstances of the case, the Tribunal were justified in cancelling the order under section 263 of the Income Tax Act when the order of the Income Tax Officer was erroneous and prejudicial to the interests of the revenue on account of his failure to initiate penalty proceedings under section 271B which attracted in the assessee's case due to contravention of the provisions of section 44AB

(2.) THE Reference relates to the assessment year 1987 -88.

(3.) FEELING aggrieved, the respondent preferred an appeal before the Tribunal. The Tribunal has set aside the, order passed by the Commissioner of Income -Tax under section 263 of the Act on the ground that failure to initiate penalty proceedings at the time of passing of the assessment order does not render the order erroneous or prejudicial to the interest of the revenue.