Union Of India & Ors VS. Ganesh Prasad Sharma

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Union Of India & Ors VS. Ganesh Prasad Sharma

The Judgement Information System REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 5065 OF 2008 (Arising out of SLP (C) No. 4379 of 2007) Commnr. of Income Tax-I, Ahmedabad Versus Gold Coin Health Food Pvt. Ltd.

(With C.A. No. 5066 /2008 @ SLP (C) No. 14785/2007)

JUDGMENT Dr. ARIJIT PASAYAT, J.

1. Leave granted.

2. Expressing doubt about the correctness of the judgment rendered by a Division Bench of this Court in Virtual Soft Systems Ltd. V. Commissioner of Income Tax, Delhi (2007 (9)

SCC 665), a reference has been made by another Division Bench by order dated 7.4.2008 to a larger Bench. The question which was decided in Virtual's case (supra) was as to whether the penalty under Section 271 (1) (c) of the Income Tax Act, 1961 (in short the `Act') can be levied if the returned income is a loss. This question has to be considered in the background of the amendment made by Finance Act, 2002 (in short `Finance Act') w.e.f. 1.4.2003 in Explanation 4 to Section 271(1)(c)(iii) of the Act. In Virtual's case (supra) the department placed reliance on Notes on Clauses relating to the aforesaid a...

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