S.S.NIJJAR, J. - (1.) IN this writ petition under Arts. 226 and 227 of the Constitution of India, the prayer is made for the issuance of a writ in the nature of certiorari quashing the order dt. 6th March, 1981 (Annexure P2), passed by respondent No. 1 and the order dt. 25th Feb., 1996, of respondent No. 2 upholding the order of respondent No. 1 passed under r. 117A of the IT Rules, 1962, r/w s. 139(8) of the IT Act, 1961 (hereinafter referred to as "the Act"). The petitioner is a registered firm under the Partnership Act as well as under the IT Act, 1961. Shri K. K. Sehgal through whom the present writ petition has been filed, is one of the partners of the firm. The dispute relates to the asst. yr. 1974-75 and the previous year relevant to this assessment year is 31st Dec., 1973. According to s. 139 of the Act, the return was to be filed on or before 30th June, 1974. It as actually filed on 30th Oct., 1974. The assessing authority imposed a penalty under s. 271(1)(a) and interest under s. 139(8) of the Act amounting to Rs. 29,915. On 28th Feb., 1977, the petitioner moved an application under s. 139(8) of the Act for waiver of the interest. It was mentioned in the application that the accounts for the relevant period were received on or after 19th Oct., 1974. Earlier there had been a strike in the establishment, which had commenced on 29th April, 1974, and continued for about four months. Consequently, the audit work was held up. The ITO, respondent No. 1, did not accept the application. The default was held to be without any reasonable cause. The petitioner filed a revision petition under s. 264(1) of the Act against the order of respondent No. 1. The revision petition was also dismissed on 25th Feb., 1986.
(2.) A written statement has been filed on behalf of the respondent through respondent No. 2. In para 3, it is categorically stated that penalty proceedings initiated under s. 271(1)(a) for late filing of the return were dropped by the ITO vide his order dt. 13th Nov., 1980. Mr. Nagpal, learned counsel for the petitioner, has submitted that the period of delay in filing the return is the same for the purposes of interest as well as penalty. The ITO had the power under r. 117A(5) of the Act to waive the interest payable under s. 139 of the Act. The explanation of the petitioner having been accepted for the purposes of imposition of penalty under s. 271(l)(a) could not have been disregarded while deciding the question of waiver of interest with regard to late filing of the return.
(3.) ON the other hand, learned counsel for the respondents, has submitted that the impugned orders are speaking orders. The petitioner had failed to prove any evidence in spite of ample opportunities having been granted to the petitioner to justify the delay. Dropping of the penalty proceedings initiated under s. 271(1)(a) is not a relevant factor for the purposes of waiver of interest.;