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TMI Blog1986 (2) TMI 38X X X X Extracts X X X X X X X X Extracts X X X X ..... od on June 24, 1975, i.e., after the amendment on April 1, 1971, but before the amendment on April 1, 1976, and consequently whether the Tribunal was justified in cancelling the penalty imposed of Rs. 5,000 ? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the amended provision of section 140A(3) which came into effect on April 1, 1976, could not be invoked in the present case and consequently whether the Tribunal was justified in cancelling the penalty imposed under section 140A(3) of Rs. 8,868 ? " The assessee, a registered firm, filed its return of income relating to the assessment year 1974-75, on May 24, 1975. He was bound to pay the tax due as per the return within thirty days ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as introduced by the Finance Act, 1964, with effect from April 1, 1964. The section was amended by the Taxation Laws (Amendment) Act, 1970, with effect from April 1, 1971. Sub-section (1) of section 140A as amended requires the tax on self-assessment to be paid within thirty days after the filing of the return. Sub-section (3) confers a discretionary power on the Income-tax Officer to impose penalty as provided for thereunder for failure of compliance of the requirements of sub-section (1). Section 140A was further amended by the Taxation Laws (Amendment) Act, 1975, and the amended section came into force with effect from April 1, 1976. Sub-section (1) of section 140A as amended in 1976 required the assessee to pay the tax due on self-ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Income-tax Officer has a discretion under sub-section (3) as it stood at the relevant time to impose a penalty on the assessee within the limits prescribed thereunder. The Tribunal has, however, cancelled that part of the penalty also on the ground that section 140A(3) as amended by the Taxation Laws (Amendment) Act, 1970, was held ultra vires and void by a Division Bench of the Madras High Court in the decision in A. M. Sali Maricar's case [1973] 90 ITR 116. Regarding the binding nature of the decision of the Madras High Court on Tribunals outside its area of jurisdiction, a Division Bench of the Bombay High Court in CIT v. Smt. Godavaridevi Saraf [1978] 113 ITR 589, stated thus at page 592: " Actually, the question of authoritative ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct had been held to be perfectly valid and not violative of article 19(1)(f) of the Constitution. Counsel further points out that the decision of the Andhra Pradesh High Court in Kashiram's case [1977] 107 ITR 825 was rendered prior to the decision of the Tribunal and that has been completely overlooked by the Tribunal in following the decision of the Madras High Court in Sali Maricar's case [1973] 90 ITR 116. When hearing a reference under section 256 of the Income-tax Act, it is not open to us to pronounce upon the constitutional validity of section 140A(3) of the Act as it stood prior to April 1, 1976. We find there are conflicting views expressed by competent courts regarding its validity. The power conferred on the Income-tax Officer t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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