1. The petitioner contends that he derives income from plying a truck which is his only source of income. He filed returns of income for the assessment years 1971-72 to 1973-74 voluntarily under Section 139(4) of the I.T. Act, 1961, on October 16, 1973. While making an enquiry about some motor vehicle case, he was advised by his advocate to file his income-tax returns, notwithstanding the fact that whatever amount he earned was paid in instalments, as the same was liable to be assessed for the purpose of income-tax and, accordingly, he filed his returns for the aforesaid years. Thereafter, the ITO issued a notice under Section 148 of the Act asking him to file returns for the assessment years 1969-70 and 1970-71. This notice was served on him on October 18, 1973, and, accordingly, he filed his returns on October 22, 1973, showing the incomes which were not liable for assessment. Penal proceedings under Section 271(1)(a) were started against the petitioner and interest was also charged under Sections 139 and 217 for delay in submitting the returns and for non-payment of advance tax. The petitioner filed an application before the ITO under Sections 139(8) and215(4) of the Act for waiver of interest. The ITO, after considering the reasons given by the petitioner for the delay in filing the returns and for non-payment of advance tax, waived the interest charged against him. The reaspns stated by the petitioner for the delay in submitting the returns were accepted by the ITO and the petitioner also filed the petition for holding that no penalty should be imposed. It was contended that the factors that constituted a ' sufficient cause ' for the purpose of Section 139(8) also amounted to a ' reasonable cause ' for the purpose of Section 271(1)(a) of the Act and no penalty should be imposed. Though the imposition of interest was waived, yet the ITO held that the petitioner was liable to pay penalty. As against this order, the petitioner went in appeal before the AAC, but the appeal was dismissed. The petitioner also filed a revision before the Commissioner of Income-tax and the revision was also dismissed. The petitioner has, therefore, filed this application on the ground that the learned Commissioner has not considered the grounds mentioned in the petition and, as such, the order amounts to an illegal exercise of jurisdiction.
2. In the return filed on behalf of the Revenue, it is contended that the contention of the petitioner cannot be accepted on the ground of ignorance of law and, however wrong the order of the Commissioner may be, the said order cannot be interfered with.
3. It is not disputed that the petitioner voluntarily filed returns for the years 1971-72 to 1973-74 and, in pursuance of a notice under Section 148 of the Act, he also submitted returns for the years 1969-70 and 1970-71, a few days after the receipt of such notice. It is also not disputed that the reasons stated by the petitioner were accepted for the delay in filing the returns and the imposition of interest was waived by the ITO. The only point in dispute is in respect of the imposition of penalty. The petitioner contends that while waiving interest, the reasons for the delay in filing the returns for the years 1969-70 and 1970-71 having been accepted as reasonable cause for the delay, the very same consideration should have been applied in respect of the imposition of penalty and, as such, he should have been exempted from the penalty. From the petition filed by the petitioner, it appears that it was contended that there was no difference between a 'sufficient cause' and a 'reasonable cause' and the petitioner also relied on a decision of the Andhra Pradesh High Court. The only ground on which the penalty has not been waived, as appears from the orders of the Asst. Commissioner as well as the Commissioner, is that there was delay in filing the returns which were filed only after the service of the notice under Section 148 and though the petitioner had co-operated in filing the returns for the subsequent years, he did not file returns for the previous two years for which penalty has been imposed, inasmuch as he filedreturns in pursuance of a notice under Section 148. It also appears that the ground taken by the petitioner was that his income was only out of one truck and as his income was below the assessable limit he believed that no return was to be filed, but when in connection with a motor vehicle case he was advised by his advocate to file returns, he filed his returns for 1971 onwards.
4. The learned standing counsel for the Revenue contends that the grounds for waiver of interest are absolutely different from the grounds for exemption of penalty and ignorance of law cannot be treated to be a ground for waiver of penalty. He further contends that this court cannot interfere with the order of the Commissioner as this court cannot sit in appeal against the decision of the Commissioner.
5. From the order of the Commissioner, it appears that he has only reiterated the facts stated by the AAC. The only ground on which the order is based is that the petitioner did not co-operate with the Revenue in filing the returns in time and he filed returns in pursuance of a notice issued by the Department. The grounds taken by the petitioner for the exemption of penalty in his petition filed before the authorities contain the submission and also reference to the decision of the Andhra Pradesh High Court. Apparently, these grounds have not been taken into consideration by the learned Commissioner. It is not disputed that the ITO can hold that no penalty should be imposed if the default was. for good and sufficient reasons. For subsequent periods as well as for the period under consideration there was a delay in submitting the returns. Interest has been waived for such delay. The Department was satisfied about the delay in filing the returns for the two years in question on the grounds mentioned by the petitioner in his petition. The decision of the Andhra Pradesh High Court referred to by the petitioner is in Repaka Seetharamaswamy v. CIT : 42ITR829(AP) . Of course, it was a case in which the cause shown by the assessee was not accepted by the Department, but it was held therein that there is no substantial difference between ' sufficient cause' and ' reasonable cause '. It appears that this decision was not taken into consideration by the authorities while disposing of the application of the petitioner. Of course, ignorance of law is no excuse in a general sense. But from the facts and circumstances of this case, it is evident that the petitioner contended that his income, as shown in the returns, was below the assessable point and for the subsequent years he filed returns under the advice of his counsel. There is no reference in the order about this contention of the petitioner. From the order of the learned Commissioner as well as that of the AAC it is not found whether they took the contentions of the petitioner into consideration and the orders also do not show the distinctive position relating to waiver of interest and waiver of penalty, ascontended by the learned standing counsel for the Revenue. All these factors clearly establish that the authorities concerned did not apply their mind carefully to the contentions of the petitioner, though prima facie the order appears to be a speaking order. This amounts to wrong exercise of jurisdiction and lack of fair play. In such circumstances, we consider it necessary that the learned Commissioner should reconsider the matter and take into consideration the contentions raised by the petitioner.
6. Reliance has been placed by the learned standing counsel on the case of Swaran Singh v. State of Punjab : AIR1976SC232 . This was a case relating to appreciation of evidence. It has been held in this decision that the limitation in a case of issue of a writ of certiorari necessarily means that findings of fact reached by the inferior court or tribunal as a result of the appreciation of evidence cannot be reopened or questioned in writ proceedings. But an error of law which is apparent on the face of the record can be corrected by a writ. This was a case where the question arose whether inadmissible evidence had been taken into consideration and legally admissible evidence had not been taken into consideration. But it has been held in that case that the writ jurisdiction also extends to cases where orders are passed by inferior courts or tribunals in excess of their jurisdiction or as a result of their refusal to exercise jurisdiction vested in them or they act illegally or improperly in the exercise of their jurisdiction causing grave miscarriage of justice. The instant case comes under the last category and here the concerned authorities have not properly exercised their jurisdiction, inasmuch as the order clearly shows that the contentions of the petitioner have not been taken into consideration and, as such, the decision cited by the learned standing counsel is of no help to the opposite party.
7. In the result, the writ application is allowed. The order of the learned Commissioner of Income-tax is quashed and the case is remitted to the learned Commissioner who shall reconsider the application of the petitioner for waiver of the penalty, keeping in view the observations made above.
8. We make no order as to costs.
P. K. Mohanti, J.
9. I agree.