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Section 273 of the Income-tax Act, 1961 - Penalty - For false estimate of, or failure to pay advance tax - Whether levy of penalty under section 273(2)(b) is a matter of discretion and discretion available to Assessing Officer is equally available to appellate authorities - Held, yes Mrs. Pushya Sitaraman for the Applicant. P.P.S. Janardhana Raja for the Respondent. JUDGMENT R. Jayasimha Babu, J. - The assessment year is 1982-83. At the instance of the Revenue, the following question has been referred to us for our consideration : "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in law and had valid materials in cancelling the penalty levied under section 273(2)(b) of the Income-tax Act, 1961, in this case for the assessment year 1982-83?" 2. The assessee is a Hindu undivided family. It filed its first income-tax return on September 30, 1986, for the assessment year 1982-83, in which year there was a search in the premises which subsequently resulted in the assessee admitting an additional income of Rs. 8,25,000. The assessee had also sought protection under the Amnesty Scheme. The Tribunal had held that the assessee was eligible for such protection. The assessee was subjected to penalty under section 273(2)(b) of the Act by the Assessing Officer for not having furnished the estimate of the advance tax payable. Though the Commissioner had upheld that penalty, the Tribunal set aside the same. The reasons given by the Tribunal for setting aside the order of the Commissioner, in its own words, are : "During this period it is possible that the assessee was weighing the pros and cons of…

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