Commissioner of Income Tax vs Haryana Education Society

G.S. Singhvi, J.—In these appeals, the Revenue has sought determination of the following question of law :

"Whether, on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal has erred in law in upholding the order of the learned Commissioner of Income Tax (Appeals) in cancelling the penalty imposed u/s 271(l)(c) of the Income Tax Act, 1961 ?"

A perusal of the record of the appeals shows that during the course of examination of the assessee''s case for the assessment year 1989-90, the Assessing Officer felt that the assessee had concealed income not only in relation to the year under assessment but also the previous year and, therefore, after issuing notice u/s 274 read with Section 271(l)(c) of the Income Tax Act, 1961 (for short "the Act"), he imposed penalty of Rs. 11,550 in relation to the assessment year 1988-89 and Rs. 23,110 in relation to the assessment year 1989-90. The appeals filed by the assessee against the orders of penalty were allowed by the Commissioner of Income Tax (Appeals), Rohtak, (for short "the CIT (Appeals)"), on the ground that similar penalties imposed for the assessment years 1986-87 and 1987-88 had been set aside by the Deputy Commissioner of Income Tax (Appeals), Rohtak. The Income Tax Appellate Tribunal, Delhi Bench "E", New Delhi (for short, "the Tribunal"), upheld the order of the Commissioner of Income Tax (Appeals) and dismissed the appeals filed by the Revenue with the following observations :

"In the appeal before the Commissioner of Income Tax (Appeals), it was submitted that the assessee claimed deduction of house tax considering the actual payment of the tax made in the years under consideration. The claim was made in the light of the proviso to Section 23(1) of the Act. The actual payment in any case was made and the claim was bonafidely made for deduction and such claim would not amount to concealment for the purpose of penalty u/s 271(l)(c). It was also explained that the interest was calculated by the assessee on its own basis and, therefore, there was no question of any concealment in this regard. The Commissioner of Income Tax (Appeals) accepted the explanations and cancelled the penalty for both the years in the light of the order for the assessment years 1986-87 and 1987-88.

The Revenue is aggrieved and has come up in appeal before the Tribunal. At the time of hearing, none appeared on behalf of the assessee. The appeals are, therefore, disposed of ex parte and on the merits after hearing Shri Shantanu Dhamija. From the order of the Commissioner of Income Tax (Appeals), it is seen that the penalty for the earlier years have already been cancelled by the Commissioner. On the same facts, the penalties have been cancelled for these assessment years. No distinguishing factor has been produced before us to come to a different conclusion. We accordingly uphold the order of the Commissioner of Income Tax (Appeals) for both the years."

At the hearing, we enquired from Shri Sawhney as to whether the orders passed by the Commissioner of Income Tax (Appeals) in relation to the assessment years 1986-87 and 1987-88 are under challenge before this court or the Supreme Court. In reply, learned counsel stated that no such proceedings appear to have been taken by the Revenue.

In view of the above, we do not find any valid ground to entertain the prayer made in these appeals.

We are further of the view that once the Commissioner of Income Tax (Appeals) had accepted the explanation given by the assessee in respect of the allegation of concealment of income, there is no scope for interference by this court.

Hence, the appeals are dismissed.