2003 (1) TMI 12 - HC - Income Tax

Section 272A(2) - Penalty - Whether the newly inserted proviso vide the Finance (No. 2) Act 1991 with effect from October 1 1991 to section 272A(2) is applicable to the respondent-assessee whose default relates to the assessment year 1989-90 requiring the assessee to file returns on or before April 30 1989 for the period ending on March 31 1989? - In the absence of any retrospective effect to such provisions this newly inserted proviso cannot have any impact with regard to any default relating to the assessment year 1989-90 requiring the assessee to file the return on or before April 30 1989 for the period ending on March 31 1989 - Section 272A(2) is a charging section and has come into effect only from October 1 1991 and it cannot be said to be procedural by any norms.

Summary

The High Court of Rajasthan allowed the income-tax appeal against an order from 1999, relating to the assessment year 1989-90 for M/s. New Rajasthan Trading Company. The court ruled that a newly inserted proviso in 1991 cannot apply retrospectively to defaults from 1989-90. The Income-tax Appellate Tribunal's view that the relevant section was procedural was deemed incorrect, as it is a charging section effective from 1991. The appeal was allowed, and the previous order was set aside.