Taxpublishers.in - InterestingDecision/Flash_16144.htm - Tax Publishers Your Tax Solution Hub

Share via Whatsapp 225 Views


The Tax Publishers Calcutta Urology Research Centre Pvt. Ltd. v. Asstt. CIT [ITA Nos. 518 to 522/Kol/2013, dt. 21-3-2016] : 2016 TaxPub(DT) 1578 (Kol-Trib) Penalty under section 271B levy *Facts:* Assessee arising out of a to search operations was slapped with a penalty under section 271B for non-filing of audited returns which was also upheld by the FAA. Assessee pleaded ignorance of law and since the work was entrusted to a CA whose misconduct was also in question before the ICAI they are not levied with penalty. On further appeal: Held by ITAT in favour of the assessee that no penalty be imposed for bona fide ignorance of law. It is often said that every one is presumed to know the law, but that is not a correct statement ; there is no such maxim known to the law. Over a hundred and thirty years ago, Maula J. pointed out in Martindale v Falkner (1846) 2 CB 706 : " There is no presumption in this country that every person knows the law : it would be contrary to common sense and reason if it were so." Scrutton L.J. also once said : " It is impossible to know all the statutory law, and not very possible to know all the common law. " But it was Lord Atkin who, as in so many other spheres, put the point in its proper context when he said in Evans v. Bartlam (1937) AC 473 :" .... The fact is that there is not and never has been a presumption that every one knows the law. There is the rule that ignorance of the law does not excuse, a maxim of very different scope and application." It is, therefore, not possible to presume, in the absence of any material placed before the court, that the appellant had full knowledge of its right to exemption so as to warrant an inference.

The Tax Publishers

Calcutta Urology Research Centre Pvt. Ltd. v. Asstt. CIT [ITA Nos. 518 to 522/Kol/2013, dt. 21-3-2016] : 2016 TaxPub(DT) 1578 (Kol-Trib)

Penalty under section 271B levy

Facts:

Assessee arising out of a to search operations was slapped with a penalty under section 271B for non-filing of audited returns which was also upheld by the FAA. Assessee pleaded ignorance of law and since the work was entrusted to a CA whose misconduct was also in question before the ICAI they are not levied with penalty. On further appeal:

Held by ITAT in favour of the assessee that no penalty be imposed for bona fide ignorance of law.

It is often said that every one is presumed to know the law, but that is not a correct statement ; there is no such maxim known to the law. Over a hundred and thirty years ago, Maula J. pointed out in Martindale v Falkner (1846) 2 CB 706 : " There is no presumption in this country that every person knows the law : it would be contrary to common sense and reason if it were so." Scrutton L.J. also once said : " It is impossible to know all the statutory law, and not very possible to know all the common law. " But it was Lord Atkin who, as in so many other spheres, put the point in its proper context when he said in Evans v. Bartlam (1937) AC 473 :" .... The fact is that there is not and never has been a presumption that every one knows the law. There is the rule that ignorance of the law does not excuse, a maxim of very different scope and application." It is, therefore, not possible to presume, in the absence of any material placed before the court, that the appellant had full knowledge of its right to exemption so as to warrant an inference.