JUDGMENT
1. The Income-tax Appellate Tribunal, Allahabad, has referred the following two questions under Section 256(1) of the Income-tax Act, 1961 hereinafter referred to as "the Act", for opinion to this court.
"(i) "Whether, on the facts and circumstances of the case, the hon'ble Tribunal was justified in cancelling the order of the learned Commissioner of Income-tax (Appeals) and restoring the order of the Income-tax Officer on the ground that payment made after the last date of payment of third instalment of advance tax but before close of the financial year (relevant to assessment year) is not a proper compliance with Section 209A for the purpose of imposition of penalty under Section 273(2)(ia) of the Income-tax Act, 1961, whether or not a revised estimate has been filed ?
(ii) Whether the tax paid during the previous financial year (up to March 31) should be treated as advance tax for the purpose of computation of penalty under Section 273(2)(aa) or not ?"
2. Briefly stated the facts giving rise to the present reference are as follows :
3. The reference relates to the assessment year 1980-81 in respect of the penalty imposed under Section 273(2)(aa) of the Act. The Income-tax Officer has imposed a penalty under Section 273(2)(ia) of the Act amounting to Rs. 8,000. According to him, the respondent had furnished an untrue higher estimate of advance tax, on June 14, 1978, showing advance tax payable at Rs. 1,51,575. Later on, he filed a revised higher estimate under Section 209A(4) on December 12, 1979, declaring advance tax payable at Rs. 4,83,750 and paid Rs. 4,78,756 up to December 15, 1979. The applicant was following the calendar year as its accounting year. The advance tax paid was more than 75 per cent, of the assessed tax. However, the Income-tax Officer had imposed penalty. In appeal, the Commissioner of Income-tax (Appeals) cancelled the penalty which order has been reversed by the Tribunal on the ground that the payment of advance tax after the demand date cannot be taken into consideration for determining penalty. It may be mentioned here that under Section 273(2)(ia) the quantum of penalty prescribed is not less than 10 per cent, but shall not exceed 11/2 times the amount by which tax actually paid during the financial year immediately preceding the assessment year falls short of 75 per cent, of the assessed tax. As in the present case during the financial year in question the advance tax paid during the financial year did not fall short of 75 per cent, of the assessed tax no penalty could have been imposed. It may be mentioned here that the assessed tax, was Rs. 6,91,020 whereas the applicant had deposited a sum of Rs. 6,53,756 as tax including advance tax during the relevant financial year. In this view of the matter no penalty could have been imposed.
4. We, therefore, answer the first question referred to us in the negative, i.e., in favour of the assessee and against the Revenue. So far as the second question is concerned though it has become academic in I. T. R. No. 102 of 1987 (CIT v. Praveen Kapoor ), decided today we have held that any amount of advance tax, which is deposited subsequent to the date prescribed for depositing the tax in the relevant financial year is to be treated as advance tax. In this view of the matter we answer the question referred to us in the negative, i.e., in favour of the assessee and against the Revenue. However, there shall be no order as to costs.