COMMISSIONER OF INCOME TAX Vs. ARAVALI SECURITIES & FINANCE LTD.
HIGH COURT OF DELHI
COMMISSIONER OF INCOME TAX
Aravali Securities And Finance Ltd.
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(1.) ITA No. 1264/Del/2004 relevant for the asst. yr. 1994 -95. After hearing learned counsel for the parties, we are of the opinion that this appeal ought to be admitted. We frame
the following substantial question of law for consideration :
(2.) "Whether the Tribunal was correct in law in deleting the penalty imposed by the AO under s. 271(1)(C) of the Income - tax Act, 1961 -
(3.) FILING of paper books is dispensed with. 4. The penalty imposed by the AO was deleted by the Tribunal by relying on a judgment of this Court in CIT vs. Ram Commercial Enterprises Ltd. (2001) 167 CTR (Del) 321 : (2000) 246 ITR 568 (Del). 5. The question of law framed by us suggests that the Tribunal did not go into the question whether the penalty was actually leviable on the assessee or not. The Tribunal came to the conclusion that in view of the decision of this Court in Ram Commercial Enterprises Ltd., Diwan Enterprises vs. CIT & Ors. (2001) 167 CTR (Del) 324 : (2000) 246 ITR 571
(Del) and CIT vs. B.R. Sharma (2005) 196 CTR (Del) 454 : (2005) 275 ITR 203 (Del), if the AO has not recorded his
satisfaction that penalty proceedings ought to be initiated against the assessee, then there is a good ground for setting
aside the penalty proceedings against the assessee. In view of this, we have gone through the assessment order passed
by the AO, wherein it has been recorded as follows :
"Since the assessee has furnished inaccurate particulars of its income and has deliberately reduced its income liable to tax as discussed in para IA to ID and para 2. Hence, penalty proceedings under s. 271(1)(c) have been initiated separately." ;
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