Income-tax--

----Reference---Penalty---Registered firm-.-Delay in filing return-- tax paid more than assessed tax---Tribunal finding that there was sufficient cause for delay---Finding of fact---No question of law arises---Cancellation of penalty justify ---Indian Income Tax Act, 1961, Ss.256 & 271(1), (2).

The assessee a registered firm, was levied with penalties by Assessing Officer for late. submission of returns for the assessment years 1981-82 to 1984-85. The Deputy Commissioner of Income-tax (Appeals.) deleted the penalties and held that there was reasonable cause for the delay in filing the returns of income for the assessment years in question. The Tribunal while upholding the Deputy Commissioner of Income-tax (Appeals) order, found further that the assessee had paid, more advance tax than the assessed tax and there was sufficient cause for non-finalisation. of accounts, The Tribunal rejected the application of the Department under section 256(1) of the Income Tax Act, 1961. On further applications to direct reference under section 256(2), of the question whether for purposes of levy of penalty, the advance tax should have been computed as in the case of an unregistered firm:

Held, dismissing the applications for reference, that the two Appellate Authorities after considering the facts of the case had concurrently held that there was sufficient cause for not filing the returns in time. This finding of fact could not be questioned by the Department. Nothing substantial could he demonstrated by the Department, to show that the finding was perverse and not supportable by the evidence on record. The order of the Tribunal was based on an appreciation. of facts and did not give rise to any referable question of law.

D.D. Vyas for the Commissioner.

S. S. Samvatsar for the Assessee.

JUDGMENT

N. K. JAIN, J.---In all the aforesaid four miscellaneous cases, the Commissioner of Income-tax, Bhopal, has filed applications under section 256(2) of the Income Tax Act, 1961 (for short, "the Act"), seeking a direction to the Income-tax Appellate Tribunal, Indore, to state the cases and refer the proposed common questions of law, as extracted below for the opinion of this Court:

"(1) Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was justified in law in holding that the legal fiction of treating a registered firm as unregistered firm as provided in section 271(2) of the Income Tax Act, 1961, has to be carried to its logical end so far as it relates to levy of penalty under section 271(1) of the Income Tax Act, 1961?

(2) Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in holding that for the purpose of levy of penalty the amount of advance tax paid by the registered firm should be computed in the manner as to what would have been the amount of advance tax, had it been an unregistered firm and the amount of advance tax should be deducted from the tax computed on the total income treating. the firm as unregistered firm?

The assessee is a registered firm which was levied with penalties by the Assessing Officer for late submission of returns for the assessment years 1981-82 to 1984-85 by three separate orders passed on March 24, 1983 (for, the assessment years 1981-82 and 1982-83), March 8, 1985 (for the assessment year 1983-84), and June 24, 1986 (for the assessment year 1984-85). All these orders were challenged successfully by the assessee firm in appeal before the Deputy Commissioner of Income-tax, Indore, who by a common order, dated February 3,1992, deleted the penalties holding that the assessee was prevented by sufficient cause from filing the returns in time. The order of the Deputy Commissioner of Income-tax (Appeals) was confirmed in second appeal by the Tribunal by a common order dated January 13,1993, passed in I.T. As. Nos. 341/342/343/344/Ind of 1992. As the Department was not satisfied with the decision of the Tribunal, it moved reference applications under section 256(1) of the Act, requesting the Tribunal to state the case and refer the aforesaid questions to this Court. These applications were also rejected by the Tribunal by a common order, dated April 21, 1993, passed in R. As. Nos. 38 to 4i/Ind of 1993 holding that the decision of the Tribunal is based on appreciation of facts and as such it does not give rise to any referable question of law. The Department has, therefore, come up before this Court under section 256(2) of the Act.

We have heard Shri D. D. Vyas, learned counsel for the applicant/Department and Shri S S. Samvatsar, learned counsel for the non -applicant/assessee.

The Deputy Commissioner. of Income-tax (Appeals) while allowing appeals of the assessee has in para. 8 of his order concluded:

"After considering the facts of the case and the submissions of the appellant it is held that there was reasonable cause for the delay in filing the returns of income for the above years. "

The Tribunal whsle. affirming the aforesaid finding of the Deputy Commissioner of Income-tax (Appeals) observed:

"Moreover, it is to be seen that the assessee has paid more advance tax than the assessed tax. This conduct of the assessee evinces that there was sufficient cause for non-finalisation of the accounts since the assessee would not have caused delay in getting the refunds unless there was compelling reason for the delay.

It will be, thus, seen that the two appellate authorities after considering the facts of the case have concurrently held that there was sufficient cause for not filing of returns in time. This is a finding of fact which as observed by the Tribunal and rightly so, could not be questioned by the Department. Before us also, nothing 'substantial could be demonstrated by learned counsel for the applicant---Department---that the finding arrived at by the two authorities above was perverse and not supportable by the evidence on record. We are therefore, satisfied that the order of the Tribunal is based on an appreciation of acts and as such does not give rise to any referable question of law.

We, thus, dismiss the reference applications but without any order as to costs. Counsel'sfee is,however,fixed at Rs.750-for each side, in each case, if certified.

This order be retained in M.C.C. No. 485 of 1993 and a copy each be placed in the records of M.C.C. Nos. 486 of 1993, 487 of 1993 and 48F of 1993.

M.B.A./3201/FCApplication dismissed