K.C. Agrawal, J.
1. The matter relates to the assessment years 1965-66 to 1967-68. Radhey Shyam, the assessee, is a partner in two firms, viz., M/s. Radhey Shyam Babu Ram and M/s. Radhey Shyam Baijnath Prasad. The details of the returns filed for these three years by the assessee are as follows :
The original return was filed on October 13, 1965. The revised return was filed on December 21, 1968.
In the original return the income disclosed was Rs. 10,667, whereas in the revised return the income shown was Rs. 29,285.
The assessment was completed on a total income of Rs. 42,848.
The original return was filed on April 29, 1966. The revised return was filed on January 12, 1968.
In the original return the income shown by the assessee was Rs. 35.251.
This was, however, enhanced to Rs. 38,850 in the revised return. The assessment was completed on an income of Rs. 40,270.
The original return was filed on September 14, 1967. The revised return was filed on January 23, 1968.
In the original return the assessee showed the total income at Rs. 28,020. This was, however, raise4 to the figure of Rs. 55,700 in the revised return.
The assessment was completed on a total income of Rs. 62,006.
2. As the ITO was of the opinion that the assessee had concealed the income in the aforesaid three years, and since the minimum penalty leviable was found to be more than Rs. 1,000, he referred the matter of imposition of penalty on the assessee to the IAC. The assessee contended before the IAC that the filing of revised returns, surrendering the cash credits, was purely voluntary, hence there was no concealment of income. The IAC held that the revised returns were filed by the assessee only when the ITO had suspected the concealment. In this view, the IAC levied penalties of Rs. 6,420, Rs. 5,590 and Rs. 11,160 for these three years.
3. The assessee took the matter in appeal. The Tribunal held that the filing of revised returns in the aforesaid three years was voluntary, and that it was not correct that the revised returns were filed by the assessee only after he was confronted with the deposits of cash credits in the account books of the firm. Since the Tribunal found that the assessee was not guilty of concealment of income in the year 1965-66, it exonerated the assessee from the levy of penalty altogether. But, having held that the non-disclosure of the amounts in the years 1966-67 and 1967-68, was not innocent and was wilful, the Tribunal held that penalty was imposable on the assessee in the aforesaid two years. The Tribunal, however, held that penalty had to be imposed on the assessee on the basis of the figures given in the revised returns. In other words, the view of the Tribunal was that penalty could not be imposed with reference to the original returns.
4. Feeling aggrieved, the department filed an application under Sub-section (1) of Section 256 of the I.T. Act, 1961. As the Tribunal was satisfied that a question of law arose for decision in the aforesaid three cases, it solicited the opinion of the High Court on the following question:
' Whether, after the assessee voluntarily filed a revised return, under Section 139 of the Income-tax Act, 1961, penalty is imposable under Section 271(lXc) of the Income-tax Act, 1961, on the basis that the assessee furnished inaccurate particulars in the original return '
5. The main question that arises for decision in this case is whether the filing of the revised returns under Sub-section (5) of Section 139 of the I.T. Act was justified. If the answer to the aforesaid question is in the affirmative, the penalty would be imposable on the assessee with reference to the second or revised returns. But, if the answer is in the negative, penalty had to be imposed on the basis of original returns. At this place, it would be convenient to reproduce Sub-section (5) of Section 139 of the I.T. Act, which deals with the filing of the revised returns. It reads:
' If any person having furnished a return under Sub-section (1) or Sub-section (2), discovers any omission or any wrong statement therein, he may furnish a revised return at any time before the assessment is made.'
6. It would be noticed that the requirement of filing a revised return is that the assessee must have discovered any omission or any wrong statement. The word 'omission' connotes an unintentional act or neglect to perform what the law requires. Similarly, the words 'wrong statement' would include within its scope a statement which is not false to the knowledge of the person making it. Another expression required to be understood for considering the scope of Section 139(5) is the word 'discovers'. The word 'discovers' will take within its ambit that which was hidden, concealed or unknown. On a reading of the provisions of Sub-section (5) of Section 139, in the light of what has been said above, it would be found that the benefit of this provision cannot be claimed by a person who has filed a false return knowing it to be false. For filing a revised return under Section 139(5), it is essential that an assessee must not be guilty of deliberate concealment of particulars. In Amjad Ali Nazir AH v. CIT : 110ITR419(All) , a Division Bench of this court held that a revised return can be filed only when a person discovers any omission or any wrong statement therein. It cannot cover a case where the omission or a wrong statement contained in the first return was deliberate. It is clear from the said case that if an assessee deliberately omitted particulars of his income or made wrong statement in the original return, the revised return would be of no avail to him as it will not be a return contemplated by Sub-section (5) of Section 139 of the Act.
7. Sri N.B. Nigam, counsel for the assessee, however, contended that since the revised returns were filed voluntarily, the provisions of Sub-section (5) of Section 139 were applicable to the assessee. The submission does not appear to be correct. We have already held above that a revised return can be filed only when an assessee discovers any omission or any wrong statement therein. The reason or the source which led to the discovery of the omission or wrong statement is immaterial. Therefore, even if it is correct that the second returns were filed voluntarily, that would not bring the case of the assessee within the scope of Sub-section (5) of Section 139.
8. Sivagaminatha Moopanai & Sons v. CIT : 52ITR591(Mad) , is a decision of the Madras High Court dealing with Section 28(1)(c) of the Indian I.T. Act, 1922. Section 28(1)(c) was in pari materia with the provisions of Section 271(1)(c) of the present Act. In that judgment, the Madras High Court held (p. 596):
' If an assessee, therefore, makes a false return knowing it to be false, the fact that he subsequently discloses the true particulars of income cannot prevent the application of the section which is intended to punish fraud or contumacy on the part of the assessee. Indeed, in such a. case it would not even be open to the assessee to submit a revised return.'
9. It, thus, appears to us that in order to avoid imposition of penalty contemplated by Section 271(1)(c) by reason of the revised return, the revised return itself must fulfil the prerequisites of Sub-section (5) of Section 139, In other words, it must fall within the ambit of that provision. If it cannot be said that an assessee was justified in filing a revised return, then the assessee will not be entitled to get the revised return to be taken into consideration for the purpose of imposition of penalty. A revised return may supplant the original return or replace and substitute it, provided that the provisions of Section 139(5) were fulfilled.
10. In Amjad Ali's case : 110ITR419(All) , this court held that a revised return will supplant the original return provided there was no concealment or deliberate furnishing of inaccurate particulars by the assessee. The Bench held (p. 428):
' Thus, in cases where a revised return is filed in conformity with Section 139(5) of the Act, it would be the revised return which has got to be seen for penalty purposes and once the revised return discloses the true income, the question of imposition of any penalty does not arise. It will not arise on account of two considerations :
(i) because there is no concealment or deliberate furnishing of inaccurate particulars by the assessee; and
(ii) because the revised return supplants the original return.'
11. Coming to the facts of the present case, the finding of the Tribunal is liable to be divided into two parts. For the year 1965-66, the Tribunal found that since the assessee was not aware as to how the share income from the firm was going to be determined in the assessment of the firm, he could not be said to be guilty of concealment, and the disclosure made by him in the revised return was liable to be taken into account for the purposes of imposition of penalty. That being so, the order of the Tribunal exonerating the assessee from the levy of penalty, in respect of that year, is justified.
12. So far as the assessment years 1966-67 and 1967-68 are concerned, the Tribunal held that the non-disclosure was due to gross or wilful negligence on the part of the assessee. As such, the Tribunal should not have determined the penalty with reference to the revised return. It committed a mistake in doing so. The case of the assessee did not fall within the scope of Section 139(5) of the Act, and the fact that the assessee purported to file a revised return will not absolve him from liability to pay penalty under Section 271(1)(c) of the Act.
13. In CIT v. Data Ram Satpal : 99ITR507(All) , which was subsequently followed in CIT v. Ram Achal Ram Sewak : 106ITR144(All) , the view taken was that the relevant return for the purpose of Section 271(1)(c), in these circumstances, was the original return and not any return filed subsequent thereto.
14. For the reasons given above, we answer the question in respect of the assessment year 1965-66, against the department and in favour of the assessee by holding that penalty was not imposable on him on the basis of the original return. But, the reference with respect to the assessment years 1966-67 and 1967-68, is answered in favour of the department and against the assessee. The fee of learned counsel for the department is assessed at Rs. 200.