D.M. Bhandari, C.J.
1. This is a reference by the Income-tax Appellate Tribunal, Delhi Bench 'C' (hereinafter called 'j:he Tribunal'), under Section 256(1) of the:,Income-tax Act, 1961 (hereinafter called the 'new Act').
2. The assessee, Messrs. Venichand Maganlal, Sagwara, is a. registered firm.It was called upon to file a return of its income under Section 22(2), of theIndian Income-tax Act, 1922 (hereinafter called the 'old Act'), which wasserved on 26th May, 1961, The. return was due oil 1st July, ,1961, but wasfiled on 5th November, 1962. For this default, the Income-tax Officer,C-Ward, Udaipur, imposed a penalty of Rs. 4,380 under Section 271(1)(i) ofthe Income-tax Act, 1961, at the rate of 2% of the tax for each month ofdefault. The appeal to the Appellate Assistant Commissioner, Jodhpur,by the assessee was dismissed. On second appeal by the assessee, theTribunal took the view that the measure of penalty for a default mustbe in accordance with law which was in force at the time when thedefault was made. The Tribunal held that the default of delay in filingthe return was committed when the old Act was in force and as there wasno limit with regard to the minimum amount of penalty imposable, theTribunal took the view that it could reduce the penalty. The Tribunalfurther held that Section 271(1)(i) of the new Act did not lay down anyrestriction with regard to the minimum penalty imposable and as such anyamount of penalty could be imposed which may be less than the amountimposed as penalty, though it may be less than the sum at the rate of 2% ofthe income-tax for every month during which the default continues. TheTribunal reduced the penalty to Rs. 200.
3. On an application by the Commissioner of Income-tax, the Tribunal has referred the following question to this court for its opinion:
'Whether, on the facts and in the circumstances of the case, the penalty imposed under Section 271(1)(a) of the Income-tax Act, 1961, could validly be reduced from Rs. 4,380 to Rs. 200 ?'
4. In Reference No. 31/66 (Commissioner of Income-tax v. Shankarlal Naraindas,  76 I.T.R. 642 (Raj.)) made by the said Tribunal we have held that for determining the quantum of penalty, the provision contained in Section 271(1)(i) of the new Act is applicable, in a case where assessment of an assessee is made under Section 271(1)(a) of the new Act. For the reasons given in the judgment, we are unable to accept the view expressed by the Tribunal that the quantum of penalty should be in accordance with the law in force at the time when the default was committed.
5. Now there remains only the question whether under Section 271(1)(i) it was permissible for the Tribunal to impose lesser penalty than what has been imposed by the Income-tax Officer. The relevant part of Section 271 runs as follows:
'271. Failure to furnish returns, comply with notices, concealment of Income, etc.--(1) If the Income-tax Officer or the Appellate Assistant Commissioner, in the course of any proceedings under this Act, is satisfied that any person-
(a) has without reasonable cause failed to furnish the return of histotal income which he was required to furnish under Sub-section (1) of Section 139 or by notice given under Sub-section (2) of Section 139 or Section 148or has without reasonable cause failed to furnish it within the time allowedand in the manner required by Sub-section (1) of Section 139 or by suchnotice, as the case may be, or
(b) has without reasonable cause failed to comply with a notice under Sub-section (1) of Section 142 or Sub-section (2) of Section 143, or
(c) has concealed the particulars of his income or deliberately furnished inaccurate particulars of such income, 1' he may direct that such person shall pay by way of penalty,--
(i) in the Cases referred to in Clause (a), in addition to the amount of the tax, if any, payable by him, a sum equal to two per cent. of the tax for every month during which the default continued, but not exceeding in the aggregate fifty per cent. of the tax;
(ii) in the cases referred to in Clause (b), in addition to any tax payable by him, a sum which shall not be less than ten per cent. but which shall not exceed fifty per cent. of the amount of the tax, if any, which would have been avoided if the income returned by such person had been accepted as the correct income;
(iii) in the cases referred to in Clause (c), in addition to any tax payable by him, a sum which shall not be less than twenty per cent. but which shall not exceed one and a half times the amount of the tax, if any, which would have been avoided if the income as returned by such person had been accepted as the correct income.
(2) When the person liable to penalty is a registered firm or an unregistered firm which has been assessed under clause (b) of Section 183, then, notwithstanding anything contained in the other provisions of this Act, the penalty imposable under Sub-section (1) shall be the same amount as would be imposable on that firm if that firm were an unregistered firm.'
6. Section 271(1)(i) speaks in unequivocal terms that in the cases referred to in clause (a) a sum equal to 2% of the tax for every month during which the default continues, but not exceeding in the aggregate 50% of the tax was to be the amount of penalty. This means that the penalty to be imposed is to be calculated at 2% of the tax for every month during which the default continues, but the maximum limit was 50% of the tax. The view taken by the Tribunal is that Clause (i) does not lay down any minimum limit as has been provided in Section 271(1)(iii), just as in Section 271(1)(iii) both the minimum and maximum limits have been prescribed, and, therefore, it can be any sum which is less than 2% of the tax for every month during which the default continues. This argument is fallacious. In arithmetic 'equal to a particular number' means not less than that particular number as also not more than that particular number. It conveys the idea that it must be exactly the same. Thus it cannot be said that Section 271(1)(i) does not prescribe the lower limit for imposing the penalty. When this section says that the quantum of penalty imposed must be equal to 2% of the tax for every month during which the default continued, it means that it cannot be less than 2% of the tax for every month during which the default continues because it cannot be more. There is also an upper limit which is that, irrespective of the months of default, it cannot exceed 50% of the tax.
7. A question may arise whether the assessee was entitled to any deduction in respect of advance tax paid by him while calculating the amount ofpenalty. The counsel for the department has drawn our attention toCircular No. 16-D (V-50 of 1965) (F. No. 10/10263-I.T. (AI), dated 21-6-1965of the Central Board of Direct Taxes, the relevant portion of which runs asfollows:
'2. On a representation made by the Gujarat Chamber of Commerce, the matter has been reconsidered by the Board in consultation with the Ministry of Law. Under Section 271(1)(i) of the Income-tax Act, 1961, the penalty is to be 2% of the tax, if any, payable by the assessee. Section 219 of the Income-tax Act, 1961, makes it clear that any sum, other than penalty or interest, paid by or recovered from the assessee as advance tax in pursuance of Chapter XVII shall be treated as payment of tax in respect of the income of the period which would be the previous year for an assessment forthe assessment year next following the financial, year in which it was payable; and credit, therefore, shall be; given-to the assessee in the regular assessment. The two sections read together: make it perfectly clear that tax payable by an assessee as referred to in Section 271(1)(a) is the tax payable after giving credit for the advance tax paid by him as contemplated under Section 219.
3. It has, therefore, been decided that the net amount of tax payable by the assessee. for the purposes of Section 271(1)(i) of the Act, is to be arrived at by excluding the tax deducted at source as well as the advance tax actually paid by the assessee under Sections 207 to 219 of the Act. The earlier instructions issued, vide circulars referred to above, stand superseded to this extent.'
8. If the amount of penalty is to be calculated keeping in view the circular, it is not possible for us to exactly determine the amount of penalty which could be imposed on the assessee. All we can say is that the penalty to be imposed is to be calculated as aforesaid in accordance with the provisions of Section 271(1)(i) of the Income-tax Act, 1961. The reference is answered accordingly. No order as to costs.