1989 (10) TMI 30 - HC - Income Tax

Summary

Issues:
Validity of notice of advance tax under section 210 and sustainability of penalty under section 273(c) based on the notice.

Analysis:
The judgment pertains to an application under section 256(1) of the Income-tax Act, 1961, where the Income-tax Appellate Tribunal referred a question regarding the validity of a notice of advance tax and the imposition of penalty under section 273(c) to the High Court. The assessee had initially filed a return for the assessment year 1974-75, showing an income of Rs. 1,00,870. Subsequently, a notice under section 210 was issued by the Income-tax Officer, leading to a penalty imposition for non-compliance with section 212(3A) provisions. The Inspecting Assistant Commissioner imposed a penalty of Rs. 11,720, which was challenged by the assessee. The Commissioner of Income-tax (Appeals) held that the notice under section 210 was invalid as it was based on an incorrect income figure. The Revenue appealed this decision before the Income-tax Appellate Tribunal, which ruled that a small inaccuracy in the income figure on the notice did not invalidate the notice under section 210. The Tribunal emphasized that the notice was based on the correct assessment year and the inaccuracy could be rectified without rendering the notice void. Consequently, the Tribunal set aside the Commissioner's order and upheld the penalty imposition.

The High Court, after considering arguments from both parties, concluded that the question of whether the notice of advance tax under section 210 was invalid did not encompass the argument regarding the jurisdiction of issuing a revised return notice. The Court noted that this specific point was not raised or addressed before the Tribunal, and thus, it did not arise from the Tribunal's order. The Court highlighted that the question framed for consideration was limited to the validity of the advance tax notice under section 210 based on the facts presented. Therefore, the Court answered the question in the negative, favoring the Revenue. The judgment reaffirmed the Tribunal's decision that a minor inaccuracy in the income figure on the notice did not invalidate the notice under section 210, emphasizing that rectification could address such discrepancies without nullifying the notice or the penalty imposition under section 273(c).