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C.I.T. v. J. Mills - INCOME TAX REFERENCE No. 337 of 1980  RD-AH 1173 (15 October 2004)
I.T.R. No.337 of 1980
Commissioner of Income Tax, Agra v. M/s. Johan Mills, Agra
Hon'ble R.K.Agrawal, J.
Hon'ble Prakash Krishna, J.
The Income Tax Appellate Tribunal, Delhi has referred the following two questions of law under Section 256(1) of the Income Tax Act, 1961, hereinafter referred to as the Act, for opinion to this Court:-
"Whether, on the facts and in the circumstances of the case, the Income-tax appellate Tribunal was correct in law in upholding the Appellate Assistant Commissioner's action in canceling a penalty of rs.8,059/- imposed by the Income-tax Officer under Section 271(1)(a) of the Income-tax Act, 1961 ?"
"Whether, on the facts and in the circumstances of the case, the I.T.A.T. was correct in law in upholding the Appellate Asstt. Commissioner's action in canceling a penalty of Rs.11000/- imposed by the Income-tax Officer u/s. 273(b) of the Income-tax Act, 1961?"
Briefly stated the facts giving rise to the present Reference are as follows :-
For the Assessment Year 1972-73 the Income-tax Officer levied the penalties under Section 273(b) and 271(1)(a) of the Act amounting to Rs.11000/- and Rs.8059/- respectively. The penalties were levied on the basis that the assessment in the case was made in the status of an A.O.P. and the A.O.P. had neither filed the estimate of advance tax nor had filed the return of income in time. The Appellate Assistant Commissioner following the decision in the case of M/s.N.K.Patni and others cancelled the penalties. The Tribunal has affirmed the order of the Appellate Assistant Commissioner.
We have heard Sri A.N. Mahajan, learned Standing Counsel appearing for the Revenue. Nobody has appeared for the respondent-assessee.
It may be mentioned here that in the case of N.K.Patni and others reference was made by the Tribunal on the following question of law to this Court:-
"Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in holding that no assessment could be made in the status of an A.O.P. and that the income was assessable in the hands of the beneficiaries?"
The reference was registered as I.T.R. No.144 of 1981 and this Court vide judgment and order dated 24th July, 1997 had held that no A.O.P. had come to existence and, therefore, income of the joint tenants could not have been taxed on the status of A.O.P. In this view of the matter, as no assessment could have been made in the status of A.O.P. the penalty has rightly been cancelled by the Tribunal. We, therefore, answer the questions of law referred to us in the affirmative i.e. in favour of the assessee and against the Revenue. However, there shall be no order as to costs.
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