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Judgment
The Revenue is in appeal against the order of Tribunal and they have raised the following question:
Whether on the facts and circumstances of the case and in law, the Hon''ble Tribunal has erred in deleting the penalty observing that as the assessee had not filed return of income on the ground that assessee had concealed or furnished inaccurate particulars of income?
In the instant case, what is relevant are the provisions of Section 271(1)(c) which reads as under:
(1) If the AO or the CIT(A) or the CIT in the course of any proceedings under this Act, is satisfied that any person:
(a)...
(b)...
(c) has concealed the particulars of his income or furnished inaccurate particulars of such income, or,
(d)...
he may direct that such person shall pay by way of penalty,
Explanation 3 to Section 271 reads as under:
Where any person who has not previously been assessed under this Act, fails, without reasonable cause, to furnish within the period specified in Sub-section (1) of Section 153 a return of his income which he is required to furnish u/s 139 in respect of any assessment year commencing on or after the 1st day of April, 1989, and until the expiry of the period aforesaid, no notice has been issued to him under Clause (i)...
By Finance Act, 2002 w.e.f. 1st April, 2003, the words "who has not previously been assessed under this Act" were omitted.
We are concerned with the asst. yr. 1997-98. In other words, what we have to see is the provision as it then stood previous to its amendment. There is categorical finding that the assessee had earlier filed returns. Penalty is sought to be imposed on the ground of failure to file returns. The wording in Section 271(1)(c) are in case where returns have not been filed or furnished inaccurate particulars of income. Clearly the assessee''s case would not fall u/s 271(1)(c).
The Tribunal by its impugned order has noted that the said provision would not be attracted as in the facts of this case, the assessee in fact had earlier filed returns.
On behalf of the Revenue the learned Counsel sought to import Expln. 1 to Section 271. In our opinion, this was not an issue either before the AO or CIT (A) or before the Tribunal. The question must arise from the order of the Tribunal. In our opinion, therefore, the question as raised would not arise. Consequently appeal dismissed.