1976 (9) TMI 21 - HC - Income Tax

Summary

Issues:
- Imposition of penalty under section 271(1)(a) for delay in submission of income tax return
- Jurisdiction of Income-tax Officer to levy penalty when interest under section 139 has been imposed

Analysis:
The High Court of Madras was presented with the issue of whether a penalty could be imposed on the assessee under section 271(1)(a) of the Income-tax Act for the delay in submitting the income tax return when interest under the proviso to section 139 had already been imposed. The case involved two assessment years, 1965-66 and 1966-67, where the returns were filed after significant delays. The Income-tax Officer initiated penalty proceedings and imposed penalties for both years. The assessee contested the penalty, arguing that since interest had been collected under section 139(1), the Income-tax Officer lacked jurisdiction to levy the penalty. However, both the Income-tax Officer and the Appellate Assistant Commissioner upheld the penalty. The Appellate Assistant Commissioner directed a re-computation of the penalty for the latter year. The assessee then appealed to the Income-tax Appellate Tribunal, which confirmed the penalty. The High Court analyzed the provisions of section 271(1)(a) of the Act, which allows for the imposition of a penalty if a person fails to furnish the return without reasonable cause or within the specified time. The Court noted that in this case, the returns were filed after the due dates without any application for extension or order from the Income-tax Officer. The assessee's argument that the collection of interest extended the time for filing was deemed misconceived by the Court. The Court emphasized that without a formal extension of time, the returns were not filed within the required time, thus attracting the penalty under section 271(1)(a). The Court ultimately ruled against the assessee, upholding the lawfulness of the penalty imposed.