- (1.) THIS is a reference under S. 256(1) of the IT Act, 1961, at the instance of the CIT, Agra. The Tribunal, Delhi Bench 'E', has referred the following question of law for the opinion of this Court: "Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the assessee's default not being deliberate or conscious was a relevant factor for concluding that there existed a reasonable cause which prevented the assessee from furnishing the return of total income in time?"
(2.) THE dispute pertains to the asst. yr. 1974-75 and arises out of proceedings under S. 271(1)(a) of the IT Act, 1961 (for short "the Act"), for imposition of penalty for delay in filing the return of the total income. The return in the case of the assessee for the assessment year in question was due on 31st July, 1974, while it was filed on 24th Feb., 1975, after a delay of six completed months. Under the circumstances, the ITO initiated penalty proceedings for the delay in filing of the return and ultimately levied a penalty of Rs. 20,268. The penalty order was upheld in appeal by the CIT(A). On second appeal by the assessee the Tribunal let off the penalty. Hence, this reference at the instance of the Revenue. We have heard learned counsel for the parties.
(3.) IN deleting the penalty the Tribunal accepted the explanation of the assessee on account of which she was prevented from submitting the return within the prescribed time. In doing so, the Tribunal recorded its finding as under: "...There is no material on record to show that the assessee derived any income other than share income from the aforesaid partnership firm. In the absence of completion of accounts of the firm she could not have knowledge about the extent of her share income. It was for the firm concerned to complete its accounts, if it could do so after taking necessary extracts from the seized records in the sales-tax department as suggested by the ITO. Under the circumstances, the penalty in question cannot be sustained. The same is hereby deleted". ;