- (1.) The issue that arose for consideration before the court below was as to whether Section 80 of the Finance Act, 1994 (hereinafter referred to as Act) envisages only a complete waiver of penalty once reasonable cause of failure is established by the assessee or whether the provision can also be applied to a level below the minimum penalties specified under Section 76 and 78 of the Finance Act, 1994.
(2.) The said issue is decided by the High Court in favour of the respondent -assessee. However, this view is now found to be incorrect having regard to the judgment of this Court in 'Union of India and Others v. Dharamendra Textile Processors and Others' [2008 (13) SCC 369]. Following the aforesaid judgment, this appeal is allowed and the impugned order of the High Court is set aside.;