SHRINATH CARAMIC Vs. COMMISSIONER INCOME TAX

JUDGEMENT

(1.) THIS writ petition has been filed by the petitioner under article 226/227 of the Constitution challenging the order passed by the commissioner of Income Tax-II, Indore rejecting the application of the petitioner for waiver of the penalty under Section 273a of the Income Tax Act, 1961 (for short, 'the Act' ).

(2.) THE relevant facts briefly are that the petitioner is a registered partnership firm carrying on the business of trading in sanitary goods. There was a survey of the business premises of the petitioner under Section 133a of the Act on 6. 10. 1994 and pursuant to survey, the petitioner filed revised returns of income for the assessment years 1992-93, 1993-94 and 1994-95. Thereafter the petitioner also i filed a return for the assessment year 1995-96 on 31. 10. 1995 declaring an income of Rs 3,96,130, The Assessing Officer made an addition of Rs. 1,40,690/- under the head of unaccounted income from sales outside the books in the assessment order dated-'31. 3. 1998 and initiated penalty proceedings under Section 271 (1) (c)of the Act for concealment of income and thereafter imposed penalty of Rs. 56,360/-by order dated 25. 9. 1998. The petitioner, thereafter filed an application under section 273a of the Act before the Commissioner of Income Tax for waiver of the penalty but by impugned order dated 17. 09. 2002, the Commissioner of Income tax rejected the application after holding that the returns of income of the petitioner have been upwardly revised by the assessee only after survey and special audit and, hence, the revised return filed by the petitioner can not be said to be voluntary and in good faith and since the requirement of Section 273a of the Act for waiver of penalty have not been met, the application was liable to be rejected. Aggrieved, the petitioner has filed this petition under Article 226/227 of the Constitution of india.

(3.) MR. Satish Chandra Bagadia, Senior counsel appearing for the petitioner submitted that for the assessment year 1995-96, the petitioner has not filed any revised return for the assessment years 1992-93; 93-94; 94-95 the petitioner had filed revised returns on the survey of the business premises of the petitioner on 6. 10. 95 and the Commissioner of Income Tax has erroneously held that the petitioner had revised its return for the assessment year 1995-96 only after survey of special audit report and hence, the return was not voluntary and in good faith and did not satisfy the requirements under Section. 273a of the Act. He further submitted j that in the impugned order, the Commissioner of Income Tax has recorded the submissions of the Assessing Officer in its report dated 18. 12. 98 for the assessment year 1995-96 and from the said report of the Assessing Officer, it is clear that the assessing Officer has taken a view that the return has been filed voluntarily and the disclosure has been made by the petitioner in good faith and the disclosure was full and true. He submitted that the Commissioner of Income Tax had not taken these relevant facts into consideration and proceeded on an erroneous assumption that the petitioner had filed a revised return for the assessment year 1995-96 on the basis of survey and special audit which took place on 6. 10. 94.