| COURT: | ITAT Mumbai |
| CORAM: | D. Manmohan VP, Sanjay Arora (AM) |
| SECTION(S): | 221(1) |
| GENRE: | Domestic Tax |
| CATCH WORDS: | penalty, self assessment tax |
| COUNSEL: | Harshvardhana Datar |
| DATE: | March 25, 2015 (Date of pronouncement) |
| DATE: | April 13, 2015 (Date of publication) |
| AY: | 2010-11 & 2011-12 |
| FILE: | Click here to download the file in pdf format |
| CITATION: | |
| S. 221(1): Penalty cannot be levied for non-payment of S. A tax if the assessee has financial hardship | |
The assessee claimed that it was having meagre cash and current balances and was in financial constraints during the year under consideration. If there is financial hardship to the assessee it has to be considered as sufficient cause in which event penalty cannot be levied. The Revenue was unable to point out as to whether the assessee had sufficient cash/bank balance so as to meet the tax demand and also could not point out as to whether any funds were diverted for non-business purposes at the relevant point of time so as to say that an artificial financial scarcity was created by the assessee. Accordingly, penalty u/s 221(1) could not be levied
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