- (1.) Heard Sri R.R. Agrawal, learned Counsel for the Petitioner and Sri Shambhu Chopra, learned Standing counsel appearing on behalf of Respondents.
(2.) By means of the present petition, the Petitioner is challenging the order of the Commissioner of Income -tax, Moradabad dated 31 -3 -2006 passed under Sec. of the Income Tax Act (hereinafter referred to as the "Act") rejecting the application for the waiver of penalty under Sec. of the Act and also the order of the Chief Commissioner of Income -tax, Bareilly, dated 28 -3 -2006 which had been communicated by the Office of the Chief Commissioner of Income -tax, Bareilly vide letter dated 24 -5 -2006, by which he had refused to grant approval as contemplated under Sec. of the Act.
(3.) Learned Counsel for the Petitioner submitted that the Commissioner of Income -tax, Moradabad had rejected the waiver application merely on the ground that the Chief Commissioner of Income -tax, Bareilly had refused to grant approval vide its order dated 28 -3 -2006. He further submitted that the Chief Commissioner of Income -tax, Bareilly had refused to grant approval merely on the ground that the revised return was not voluntary, without considering the report of the Income Tax Officer in which he had stated that the Assessee made the disclosure voluntarily and the assessment was completed on the revised return disclosing the income of tax Rs. 19,19,430 and Assessee co -operated in the assessment proceeding and the entire taxes and interest had been paid and, therefore, the order of the Chief Commissioner of Income -tax, Bareilly refusing to grant approval is a case of non -application of mind, without considering the material on record and, therefore, liable to be set aside. He further submitted that since the discretion, which is to be exercised by the Commissioner of Income -tax under Sec. of the Act, for granting the waiver is subject to the approval by the Chief Commissioner of Income -tax as contemplated under Sec. of the Act, and refusal to grant the approval affects the right of the Assessee, thus before refusing to grant the approval opportunity of hearing should be given to the Petitioner. In support of the contention he relied upon the Division Bench decision of this Court in the case of S.K. Traders v/s. Addl. Commissioner, (2009) 26 VST 601 and the decision of the Apex Court in the case of Rajesh Kumar v/s. Dy. CIT : (2007) 13 (I) ITCL 129 (SC): (2006) 287 ITR 91 which has been approved by the Larger Bench of the Apex court in the case of Sahara India (Firm) v/s. CIT : (2007) 15 (I) ITCL 317 (SC): (2007) 289 ITR 473.;