Case Law Details
DCIT Vs Tulip Star Hotels Ltd. (ITAT Delhi)
The issue under consideration is whether CIT(A) is correct in deleting the penalty levied u/s 221(1) by the AO on the ground that assessee has paid the self assessment after the date of filling of return of income?
In the present case, the assessee could not pay the self assessment tax liability at the time of return of income, however the same has been paid subsequently on installment over a period of time. Assessee had given very elaborate reasons before the authorities below that due to huge financial crunch and hardships, assessee did not had any liquidity to pay the self assessment tax liability.
ITAT states that there are umpteen number of judgments, wherein it has been held that financial stringency is considered to be good and sufficient cause for sufficiency of reason for not levying penalty u/s 221(1). The AO has also not given any reasoning to controvert the assessee’s reasons regarding paucity of funds and if Assessee Company had sufficient reasons for not paying the self assessment tax at time, then assessee could not be considered as willful defaulter on which no penalty should be levied. Further, CIT(A) on stay of collection of demand has given the direction for payment of installments though in some other matter. Now the entire self assessment tax has been paid and the entire liability has been discharged. Thus, order of the Ld. CIT(A) deleting the penalty is upheld. Consequently, the grounds raised by the revenue is dismissed.
FULL TEXT OF THE ITAT JUDGEMENT
Please become a Premium member. If you are already a Premium member, login here to access the full content.
Author Bio
