1. All these petitions arise out of a common grievance made by the petitioners by which they were called upon to pay penalty in exercise of the powers under section 271(1) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"). According to the petitioners, the impugned action of the respondents is ultra vires, contrary to law and violative of articles 14, 265 and 300A of the Constitution of India.

2. Since a common point is raised in all the petitions though the petitioners are different, in our opinion, it would be proper if all the petitions are disposed of by a common judgment.

3. To appreciate the controversy raised in the present group of petitions, few relevant facts from one of the petitions being Special Civil Application No. 7306 of 1988 may now be stated :

4. The petitioners are the trustees of Harshadkumar Family Trust (the "trust" for short) settled by one Madhukanta Natvarlal Vora on March 31, 1967, for the benefit of her son, Harshadkumar, and his wife, Usha. That trust was a co-owner of a building known as "Shreeniketan Building" situated at Worli, Bombay, along with 20 other co-owners which were either private trusts or Hindu undivided families. The petitioner trust had an undivided share to the extent of 4.5 per cent. in the said property. The only income of the petitioner trust was the "property income" derived from the said property. The trust had also an undivided 4.5 per cent. share in the tenancy rights in plot "F" in "Shivsagar Estate" on which the said building was situated. The petitioners and others filed Suit No. 120 of 1978 in the High Court of Judicature at Bombay in ordinary original civil jurisdiction and a receiver came to be appointed by the High Court of Bombay on February 13, 1978. The income of the property was being received by the receiver since the date of his appointment as receiver and accounts were being maintained by him. It is the case of the petitioners that after the receiver was appointed, the trust addressed letters to the predecessor of respondent No. 1, Income-tax Officer, Ward "C", Nadiad, on July 27, 1981, and September 2, 1981, informing him regarding the appointment of the receiver and requesting him to communicate directly with the receiver in matters of filing returns of income, etc., as the receiver would be the representative assessee before the competent authority in Bombay as provided under sections 160 and 161 of the Act. It was also stated by the petitioner trust that the mode of taxation including the status of the assessee was changed. A copy of one such letter dated July 27, 1981, is annexed to the petition by the petitioner. According to the petitioner trust, it did not receive any reply from the predecessor of the first respondent. A joint application was, therefore, made by the petitioner trust and other co-owners on December 5, 1983, to the Central Board of Direct Taxes for transferring their file from respondent No. 1 to the Income-tax Officer, Central Circle-VIII, Bombay. A copy of that application is also annexed to the petition. A copy was also sent to respondent No. 1 and other authorities in Gujarat, but the request of the petitioner trust and that co-owners was not accepted by the respondent authorities. On the contrary, by a letter dated July 30, 1987, the Board addressed a cryptic and laconic letter rejecting the application of the petitioner.

5. It is contended by the petitioner that in spite of the receiver being appointed by the High Court of Bombay to manage the property and even though an application for transfer of the case from Gujarat to Bombay was made by the petitioners and was pending before the Board and it was within the knowledge of the first respondent, he issued notice to the petitioner in purported exercise of the powers under section 179(2) (sic) of the Act, calling upon the petitioner to show cause as to why proceedings should not be initiated against the petitioners for failure to submit returns for the assessment years 1980-81 and 1981-82. During the course of proceedings, Mr. Panchal, a representative of the petitioner trust, remained present before the first respondent and informed him that no information could be received from the court receiver regarding property income of the petitioner trust and in these circumstances, the petitioner was not in a position to submit returns or to supply detailed accounts or produce documents as required. The first respondent, however, passed orders of assessment against the petitioner trust on March 30, 1983, and December 30, 1983, for the assessment years 1980-81 and 1981-82, respectively, admitting therein that the court receiver was in possession of the building and has not supplied any accounts or information to the petitioner trust. According to the petitioners, even though in the orders of assessment, the first respondent had accepted the reasons stated by the petitioner trust for not filing the returns, for reasons best known to him, he ordered issue of show-cause notice to the petitioner trust to show cause why penalty under section 271(1)(a) of the Act should not be imposed on the trust.

6. The petitioner submitted replies on May 30, 1983, and May 31, 1984, for the assessment years 1980-81 and 1981-82, respectively. At the time of hearing, it was pointed out that the receiver did not send necessary details regarding property income as a result of which other co-owners, namely, Chhotabhai Patel Family Trust, also could not file returns within the stipulated period for the assessment year 1978-79. Interest was charged by the Income-tax Officer, Ward-C, Nadiad, under sections 139(8) and 117(v) (sic) of the Act, but the same was waived by the Commissioner of Income-tax, Baroda, vide his order dated March 21, 1985, under sections 264 of the Act by observing that the Chhotabhai Patel Family Trust was prevented by sufficient cause from filing returns in time. Copies of these orders were produced before the first respondent. In spite of the above orders, the first respondent passed the impugned order under section 271(1)(a) of the Act on May 6, 1985, and March 31, 1986, against the petitioner imposing penalty of Rs. 17,770 and Rs. 19,920 for the assessment years 1980-81 and 1981-82, respectively.

7. Being aggrieved by the above orders, the petitioner trust preferred appeals before the appellate authority, i.e., Appellate Assistant Commissioner of Income-tax. Other co-owners also filed appeals before the Appellate Assistant Commissioner, Bhavnagar, against the penalty imposed on them. The appeals of the petitioners for 1981-82 came up for hearing before the second respondent along with other appeals, who dismissed the appeals and confirmed the order passed by the first respondent. Revision applications against the said orders were also dismissed by the Commissioner of Income-tax.

8. It is against that order that the present petitions have been filed by the petitioners.

9. Mr. R. D. Pathak, learned counsel for the petitioner, contended that there is an error apparent on the face of the record committed by the authorities below in imposing penalty on the petitioners. He submitted that relevant materials which ought to have been considered by the authorities have been ignored, irrelevant and extraneous matters were kept in mind and a so-called finding is recorded which is not borne out by the evidence on record. Such finding cannot be said to be a finding based on the material on record and must be termed as "perverse". He also submitted that almost in similar circumstances, the other Appellate Assistant Commissioner granted relief in favour of the other co-owners and also in favour of some of the petitioners. He invited our attention to an order passed by the Appellate Assistant Commissioner, Income-tax, Baroda, on November 6, 1987, by which he disposed of 29 appeals. In those cases also, orders imposing penalty were passed under section 271(1)(a) of the Act and the aggrieved party had approached the appellate authority by filing appeals. It was submitted before the appellate authority that the dispute was going on regarding the property and the matter was pending in the High Court of Bombay and the court receiver was appointed. Because of the appointment of the receiver by the court, income-tax returns could not be submitted within the stipulated period and it could be said to be sufficient cause and the Income-tax Officer committed an error in imposing penalty holding that there was no reasonable cause for not submitting the return in time. The appellate authority, after considering the submissions of the appellant, specifically observed that the Income-tax Officer was not right in holding that the cause for non-filing of the return of income was of an unusual nature and was made a ground to escape from payment of penalty. It was not probable that the appellants would intentionally withhold returns of income. The Appellate Authority also observed : "I have no hesitation in agreeing with the plea of learned counsel for the appellants that they were prevented by sufficient cause from filing returns of income." Accordingly, the appeals were allowed. The order passed by the Income-tax Officer was set aside and the penalty was ordered to be deleted.

10. Mr. Pathak submitted that unfortunately the appeals from which the present petitions arise were placed for hearing before another Appellate Assistant Commissioner. Had they been placed before the same officer, in all probability, they would have been allowed. Mr. Pathak submitted that the case of the petitioners is almost identical to the case of 29 appellants whose appeals came to be allowed by the appellate authority and there is no earthly reason for not showing similar treatment and extending identical benefits which were granted in favour of those appellants. But Mr. Pathak submitted that the cause for non-submission of the return was the same which weighed with one Appellate Assistant Commissioner and was treated as reasonable cause, while according to another Appellate Assistant Commissioner, it was not. He submitted that, in these circumstances, there was an error of law apparent on the face of the record committed by the appellate officer.

11. In view of the order passed by the Appellate Assistant Commissioner, the petitioner approached the Commissioner of Income-tax, Baroda, by filing revision applications under section 264 of the Act. Mr. Pathak invited our attention to the reasons recorded by the revisional authority and particularly para 6 of the order wherein it was observed that in the opinion of the revisional authority, the orders passed by the Appellate Assistant Commissioner (in 29 matters referred to hereinabove) were not based on correct appreciation of relevant facts. He further observed that though no further appeals were filed against those orders, non-filing of appeals did not mean that the orders were acceptable in principle. The revisional authority, therefore, took the view that no reasonable cause was made out for non-filing of returns within the period prescribed by law and hence the Appellate Assistant Commissioner could not avoid penal consequences both for delay in filing returns and payment of penalty. The revision applications, therefore, came to be dismissed.

12. Mr. Pathak submitted that when other appeals were allowed by the Appellate Assistant Commissioner and no further proceedings were taken by the Department, the orders became final and penalty imposed on the petitioners was set aside. In similar circumstance and for similar reasons, the appeals of the present petitioners which were required to be allowed were dismissed and the revision applications were also dismissed. This is clearly improper and illegal and the petitions should be allowed.

13. Mr. B. J. Shelat for the Department submitted that when findings of fact have been recorded by three authorities, in exercise of the power under article 226 and/or 227 of the Constitution of India, this court cannot come to a different conclusion. He further submitted that an alternative remedy was available to the petitioners by invoking the provisions of section 246 of the Act by filing an appeal to the Commissioner, but the said remedy has not been availed of. By ignoring the statutory provisions, the petitioners have directly approached the Commissioner by filing revision applications under section 264 of the Act. When the revision applications were dismissed, it cannot be said that the Commissioner has committed an error of law which requires to be corrected by this court. Finally, it was submitted by Mr. Shelat, that even if this court is of the opinion that the orders passed by the Income-tax Officer as well as by the Appellate Assistant Commissioner were contrary to law they may be set aside but instead of granting relief to the petitioners, they may be directed to apply to the Commissioner by filing applications for waiver under section 273A(1) of the Act.

14. Having gone through the record as well as the relevant provisions of law, in our opinion, the petitions are required to be allowed. From the record, it is clear that the petitioners had intimated the authorities about the dispute in respect of property pending in the High Court of Judicature at Bombay on its original side and the receiver being appointed. The said fact is borne out by documentary evidence on record. It is also clear that for the assessment year 1978-79, the said fact weighed with the authority and penal proceedings were initiated against the assessee. Almost in similar circumstances, when the Income-tax Officer passed an order imposing penalty, it was set aside by the Appellate Assistant Commissioner in exercise of the appellate power and orders were passed. The Department accepted those orders and did not challenge the legality thereof. They have thus become final. Prima facie, we find considerable substance in the argument of Mr. Pathak that since two groups of appeals came up for hearing before two different Appellate Assistant Commissioners, different and almost contradictory orders came to be passed. Had all the appeals been placed before one officer, probably similar orders would have been passed by showing similar treatment and extending similar benefits to all persons similarly situated. It is no doubt true that the strict rule of the doctrine of res judicata does not apply to proceedings under the Income-tax Act. At the same time, it is equally true that unless there is a change of circumstances, the authorities will not depart from previous decisions at their sweet will in the absence of material circumstances or reasons for such departure : Joint Family of Udayan Chinubhai v. CIT [1967] 63 ITR 416 (SC), AIR 1967 SC 762; Radhasoami Satsang v. CIT [1992] 193 ITR 321 (SC); AIR 1992 SC 377; H. A. Shah and Co. v. CIT/EPT [1956] 30 ITR 618 (Bom).

15. In the last mentioned case, it was observed that if the question was not considered in detail in earlier proceedings, it is open to the authorities to consider those documents and to come to a different conclusion. But if the question is already decided on the basis of the facts and there is no change in that factual position, it cannot be reopened. In the instant case, as observed by us hereinabove, the fact was brought to the notice of the respondent authority by the petitioners that litigation was going on between the parties and the receiver was appointed by the High Court of Bombay. That fact was also accepted by the Department for the assessment year 1978-79 and even for the year 1982-83 in respect of a number of appeals filed by other co-owners as also by some of the petitioners. In our opinion, there was no good and justifiable cause to take a different view when some appeals came before a different officer without there being any change in the factual position and when the earlier decision was not challenged by the Department. Hence, there is an error apparent on the face of the record committed by the appellate authority. It was, therefore, obligatory on the part of the revisional authority to correct that error of law. By not allowing the revision applications, the revisional authority has also committed the same error. It is true that the petitioners could have filed an appeal under section 253 of the Act before the Tribunal against the order passed under section 246 of the Act by the Appellate Assistant Commissioner. But when the revisional authority had exercised his revisional jurisdiction under section 264 and disposed of the revisional applications and the petitioners have approached this court and rule was issued by this court after hearing the parties as early as on November 22, 1988, in our opinion, this is not a fit case to dismiss the petitions by preventing the petitioners from arguing on the merits.

16. In view of the above facts and circumstances, in our opinion, the authorities have committed an error of law apparent on the face of the record in not granting reliefs to the petitioners. We are satisfied that there was reasonable cause on the part of the petitioners in not submitting the returns in time and, hence, no penalty could have been imposed on them under section 271(1)(a) of the Act. Since the impugned action is contrary to law, it requires to be quashed and set aside. Accordingly, all the petitions are allowed, the orders passed by the Income-tax Officer and confirmed by the Appellate Assistant Commissioner and by the Commissioner of Income-tax, are hereby quashed and set aside. Rule is made absolute. In the facts and circumstances of the case, there shall be no order as to costs.