Law: Income Tax Act, 1961

Section: 273

Income-tax----Penalty---Reduction or waiver ---Commtsstoers--Conditi6nsprecedent for exercise of power ---Assessee not making satisfactory arrangement for payment of tax---Application for waiver liable to be dismissed---Indian Income Tax Act, 1961, S.273-A. Section 273-A of the Income Tax Act, 1961, lays down five conditions fundamental to the exercise of discretion by the Commissioner to reduce or waive penalty in certain cases. They are: (1) that the returns were filed by the assessee prior to the issue of a notice under section 139(2) or section 148; (2) that these were filed voluntarily and in good faith; (3) that the assessee had made a full and true disclosure of his income; (4) that he had cooperated in the inquiry relating to the assessment of his income; and (5) that he had paid or made satisfactory arrangements for the payment of the tax or interest. The five conditions laid down in section 273-A of the Act are conditions precedent before the Commissioner is clothed with jurisdiction under section 273-A of the Act to either waive or reduce the amount of penalty. Where the assessee filed returns voluntarily and in good faith, making full and true disclosure of his income, but not satisfy the condition regarding payment or making satisfactory arrangements for the payment of the tax or interest payable in consequence of the order passed under the Act by the assessing authority: Held, accordingly, that no case was made out for either waiver or reduction in the amount of penalty or interest. JUDGMENT The petitioner has impugned Annexures "P-4" and "P-5", whereby the application filed by him under section 273-A of the Income Tax Act, 1961 (hereinafter referred to as "the Act"), has been dismissed by the Commissioner of Income-tax, Jalandhar, for the assessment years 1987-88 and 1988-89. The petitioner-assessee filed income-tax returns for the assessment years 1987-88 and 1988-89 under the voluntary scheme prior to the issuance of notices under section 148 of the Act. The assessing authority imposed the tax for the assessment years 1987-88 and 1988-89. It also imposed a penalty at the rate of 10 per cent. of the tax, i.e., Rs.6,375 for the assessment year…

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