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TMI Blog1934 (6) TMI 34X X X X Extracts X X X X X X X X Extracts X X X X ..... unts produced did not contain the whole of the assessees money-lending transaction, and that the assessees .had other accounts which were not produced assessed their income at ₹ 75,892 under Section 23 (4) of the Act. The assessment at that figure is now final and conclusive. Thereafter proceedings were taken under Section 28 (1) of the Act for the purpose of imposing a penalty upon the assessees. Section 28 (1) runs as follows: If the Income-tax Officer, the Assistant Commissioner or the Commissioner, in the course of any proceedings under this Act is satisfied that an assessee has concealed the particulars of his income or has deliberately furnished inaccurate particulars of such income, and has thereby returned it below it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the tax on ₹ 37,520. Mr. Foucar, on behalf of the assessees, submitted that the question to be decided was the amount of income tax that would have been avoided if the false return had been accepted as a correct return on the date when the false return was made. He contended that as at that time the estimated assessment under Section 23 (4) had not yet been made it followed that the only two figures that could have been taken into consideration were (i) the amount of income set out in the false return and (ii) the amount of the true income as subsequently ascertained in the course of the inquiry pursuant to Section 28 (3). I do not see my way so to read the section. As the Commissioner has pointed out in his order of 17th January, 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment has been made ''; and in K.M.O. Chettiyar Firm v. The Commissioner of Income-tax [1934] ILR 12 Rang. 268, Burma. that in imposing the penalty the maximum limit that is placed upon the quantum is that the penalty must not exceed the difference between the amount of the tax on the income assessable under the Act, and the amount of the tax upon the assessable income as returned by the assessee. In the present case the Commissioner of Income-tax in the exercise of his discretion did not impose the maximum penalty, and in proceeding under Section 28 the income tax authorities ought to act fairly and reasonably in the circumstances of each case, as the Commissioner appears to have done in the present case. But the qua ..... X X X X Extracts X X X X X X X X Extracts X X X X
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