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Issues:
1. Justification of penalty under section 271(1)(a) for assessment years 1964-65, 1965-66, and 1966-67. 2. Interpretation of section 271(2) regarding penalty imposition on registered firms. 3. Applicability of the penalty calculation method under section 271(1)(i) for registered firms. Analysis: Issue 1: The Income-tax Appellate Tribunal referred questions regarding the justification of penalties imposed by the Income-tax Officer under section 271(1)(a) for the assessment years 1964-65, 1965-66, and 1966-67. The Appellate Assistant Commissioner had reduced the penalties to 50% of the tax payable by the registered firm. However, the department contended that the penalties should not be restricted, leading to an appeal to the Tribunal. Issue 2: The Tribunal accepted the department's contention that section 271(2) creates a fiction treating registered firms as unregistered for penalty purposes. The Tribunal set aside the Appellate Assistant Commissioner's order and restored the Income-tax Officer's penalties. The key question was whether the Tribunal's interpretation of section 271(2) was correct in this case involving a registered firm. Issue 3: Section 271(1)(a)(i) outlines penalty calculation for failure to furnish returns, while section 271(2) specifies penalties for registered firms. The Tribunal held that the penalties for registered firms should be calculated as if they were unregistered, rejecting the Appellate Assistant Commissioner's approach of limiting penalties to 50% of the tax payable by the registered firm. The Court upheld the Tribunal's decision, emphasizing the overriding nature of section 271(2) and its applicability to penalty calculations. In conclusion, the Court affirmed the Tribunal's decision, stating that section 271(2) applies to penalty calculations for registered firms, overriding other provisions. The judgment clarified the application of penalties under section 271(1)(a) and upheld the penalties imposed by the Income-tax Officer.
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