Skip to content


Additional Commissioner of Income-tax Vs. Ratanchand Sewakram - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtMadhya Pradesh High Court
Decided On
Case NumberMiscellaneous Civil Case No. 277 of 1976
Judge
Reported in[1985]151ITR112(MP)
ActsIncome Tax Act, 1961 - Sections 271(1)
AppellantAdditional Commissioner of Income-tax
RespondentRatanchand Sewakram
Excerpt:
- .....case, the tribunal was justified in holding that since the default is attributable to thereturn of income filed in the course of the original assessment proceedings pertaining to the assessment year 1965-66, the amended provisions of section 271(1)(c) with effect from april 1, 1968, are not applicable and, accordingly, cancelling the penalty levied under section 271(1)(c) of the income-tax act '2. the material facts giving rise to this reference, as set out in the statement of case, briefly are as follows : the assessee is an individual and the assessment year in question is 1965-66. a return of his income for the said assessment year was filed by the assessee and the assessment was completed. subsequently, the ito reopened the assessment for the year 1965-66 and issued a notice under.....
Judgment:

Sohani, J.

1. By this reference under Section 256(1) of the Income-tax Act, 1961 (hereinafter called 'the Act'), the Income-tax Appellate Tribunal, Indore Bench, has referred the following; question of law to this court for its opinion :

'Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that since the default is attributable to thereturn of income filed in the course of the original assessment proceedings pertaining to the assessment year 1965-66, the amended provisions of Section 271(1)(c) with effect from April 1, 1968, are not applicable and, accordingly, cancelling the penalty levied under Section 271(1)(c) of the Income-tax Act '

2. The material facts giving rise to this reference, as set out in the statement of case, briefly are as follows : The assessee is an individual and the assessment year in question is 1965-66. A return of his income for the said assessment year was filed by the assessee and the assessment was completed. Subsequently, the ITO reopened the assessment for the year 1965-66 and issued a notice under Section 148 of the Act to the assessee. In response to this notice, the assessee filed another return of his income on September 18, 1969, disclosing the same income as was disclosed by him in the return filed initially. Penalty proceedings were initiated against the assessee by the ITO under Section 271(1)(c) of the Act and those proceedings were referred to the IAC for disposal. The IAC imposed a penalty of Rs. 5,000 in view of the fact that the minimum imposable penalty would be equal to the amount of income concealed. Against this order, the assessee preferred an appeal before the Tribunal. The Tribunal held that the default of the assessee would be attributable to the return filed in the original assessment proceedings and that the law applicable to the assessment year 1965-66 would be that laid down in Section 271(1)(c) of the Act, prior to its amendment on April 1, 1968: At the instance of the Revenue, the Tribunal has referred the aforesaid question of law to this court for its opinion.

3. In Addl. CIT v. Balwantsingh Sulakhanmal 0065/1979 : [1981]127ITR597(MP) , we have held that if penalty proceedings are initiated in connection with a return filed in response to the notice under Section 148 of the Act, the default would not be attributable to the return filed in the course of the original assessment proceedings. We have also held, in that case, that it is the law in force on the date on which the wrongful act is committed which would determine the penalty. In view of this decision, it must be held, in the circumstances of the case, that the Tribunal was not justified in holding that the default was attributable to the return of income filed in the course of the original assessment proceedings and that the amended provisions of Section 271(1)(c) of the Act were not applicable.

4. For all these reasons, our answer to the question referred to us is in the negative and against the assessee. As none appeared on behalf of the assessee, parties shall bear their own costs of this reference.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //