Shivnarain Hariahchand and Co. vs Commissioner of Income Tax

S.S. Jha, J.—Brief facts of the case, preferred in the petition by the petitioner are that u/s 273A(l) of the income tax Act, 1961 (''the Act'') on application dated 10-2-1993 for the assessment years 1980-81 and 1981-82 and praying for waiver of penalty imposed under sections 271 (1)(a), 273 (b) and interest under sections 215 and 139(8) of the Act, an order dated 10-03-1993 was passed by the Commissioner in relation to the assessment year 1981-82 only and prayer of the applicant was rejected without assigning any reason. The petitioner challenged the order in Writ Petition No. 1203 of 1993 before this Court. This Court directed the Commissioner to pass speaking order within six months from the date of communication of the order passed by this Court. Accordingly, the case was heard after hearing the representative of the petitioner. The Commissioner after considering all the facts reduced the penalty and interest to 50 per cent (Fifty per cent). This order of the Commissioner is challenged by the petitioner. The main grievance of the petitioner is that the provisions of allowing waiver enumerated u/s 273A have not been considered . The learned counsel for the petitioner submitted that there was no mala fide on his part and accounts submitted by him were in good faith and there was no concealment of particulars of income or inaccuracy. It is not a case where the petitioner has not co-operated relating to the assessment of the year. It was submitted that in such circumstances, the Commissioner has no other option but to waive the entire penalty. The second contention of the learned counsel for the petitioner is that the respondents have waived the penalty in different cases and as such the petitioner should be given the same treatment as has been given to other assessee. The act of the respondents in not waiving the penalty in total was discriminatory and violative of article 14 of the Constitution of India.

The contention of the petitioner is opposed by the counsel for the respondents. The learned counsel for the respondents invited attention of this Court to section 273A and submitted that for reducing or waiver of amount of penalty the ingredients referred in sub-section 1(b), (c) of section 273A must be fulfilled. The learned counsel for the respondents invited attention to the provisions of sub-section 3 of section 273A and submitted that once the benefit under the provisions of this section has been provided to the assessee, he cannot avail the benefit of this provision for subsequent year.

The learned counsel for the respondents submitted that earlier an order for waiving the penalty had been passed and, therefore, the provision of section 273 A was not available to the petitioner. The learned counsel further submitted that a discretion exercised by the Commissioner in waiving a part of the penalty cannot be the subject-matter of the writ petition. He submitted that in a writ jurisdiction, the High Court does not sit in appeal upon the decision of a statutory authority. This Court can only examine the decision-making process. Unless the order is without jurisdiction or in excess of jurisdiction vested in the Commissioner or the order is perverse causing manifest injustice or the order is arbitrary or unfair, the writ Court will be slow to interfere in the matter. In support of his contention, the learned counsel relied on the case of Om Prakash Bhatia v. ITO [1990] 183 ITR 336 (Cal.). The learned counsel for the respondents further submitted that the provisions of article 14 are not attracted in the instant case. The petitioner has not disclosed in the petition how the assessees, whose penalty was waived, were similarly placed with the facts of the case of the petitioner. In such circumstances, the question of violation of article 14 does not arise.

The contention of both the parties are considered. After the order of this Court in Writ Petition No. 1203 of 1993, the Commissioner heard the petitioner and the application u/s 273A(1) and after considering the facts that the assessee has paid tax of Rs. 500 under the self-assessment and thereafter paid Rs. 20,000 on 13-02-1982, the authority found that there is considerable difference in income report and assets. It was also found that the payment was not made prompt. Thus, from the order Annexure P/5, the authority came to the conclusion that the ingredients of section 273 A were not made out for waiving the penalty. However, the penalty and interest were reduced to 50 per cent (Fifty per cent).

In such circumstances, the order passed by the authority is within its jurisdiction. The respondents have not challenged the order of waiving the penalty, as such the order passed by the authority does not call for any interference as the authority has exercised jurisdiction and the order is well within the jurisdiction of the authority.

In such circumstances, the petition has no merit and is, accordingly, dismissed summarily.