I.T.R. No.10 of 1997 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH I. T. R NO. 10 OF 1997 DECIDED ON: 07.09.2009 M/s Metalways (P) Ltd. ...Applicant Versus The Commissioner of Income Tax, Patiala ...Respondent CORAM : HON'BLE MR. JUSTICE ADARSH KUMAR GOEL HON'BLE MRS. JUSTICE DAYA CHAUDHARY Present: Mr. S. K. Mukhi, Advocate, for the applicant-assessee. Ms. Urvashi Dhugga, Advocate, for the respondent-revenue. ADARSH KUMAR GOEL, J. (ORAL) 1. The following question has been referred for the opinion of this Court by the Income Tax Appellate Tribunal, Chandigarh Bench under Section 256(2) of the Income Tax Act, 1961 (in short 'the Act') arising out of its order dated 17.09.1979 in I.T.A. No.535/Chandi/83 relating to assessment year 1978-79 in:- “Whether the tax paid within the stipulated period without filing an estimate and treated as advance is deductible while imposing penalty?” 2. The assessee did not file estimate of advance tax by the year ending 31.03.1978 in terms of Section 212 (3) of the Act. I.T.R. No.10 of 1997 -2- However, the advance tax was deposited. Penalty proceedings were initiated for non-compliance of provisions of Section 212 (3) for not filing the estimate. After consideration, penalty was imposed. 3. The CIT (Appeals) set aside the penalty proceedings only on the ground that Section 209-A which laid down requirement of filing of estimate came into force w.e.f. 01.04.1979. This view was reversed by the Tribunal with the observation that same requirement existed under Section 212 (3) of the Act and initiation of penalty proceedings was justified. Thereafter, at the instance of the assessee, the above question has been referred for opinion of this Court. 4. We have heard learned counsel for the parties. 5. Learned counsel for the Revenue raises objection that the question does not arise from the order of the Tribunal. 6. Learned counsel for the assessee submits that the question having been raised before the CIT (Appeals) as noted para 3 of the order cannot be said to be not arising before the Tribunal. The Tribunal while reversing the order of the Tribunal had to deal with the said question. We are unable to accept the objection of learned counsel for the revenue as the reference itself has been made under orders of Hon'ble Supreme Court mentioned in para 1 of statement of case. 7. Learned counsel for the assessee relies on judgment of Hon'ble Supreme Court in “Commissioner of Income Tax Vs. Kohinoor Flour Mills (P) Ltd.” (1991) 187 ITR 585 to submit that the assessee was entitled to deduct the payment of tax made for determination of basis for penalty. No contrary view has been I.T.R. No.10 of 1997 -3- shown. Accordingly, question has to be referred in favour of the assessee and against the revenue. 8. It is, however, made clear that no reference having been sought or made on question of justification or otherwise for levy of penalty, we do not express any view on the said view. 9. The reference is disposed of. (ADARSH KUMAR GOEL) JUDGE (DAYA CHAUDHARY) JUDGE September 07, 2009 Shalini/Gaurav