9911796707
TMI Blog1983 (6) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... f the 1961 Act. A return was, however, filed by the assessee on April 20, 1964. Since the return was filed belatedly, the ITO initiated penalty proceedings against it under s. 271(1)(a) of the Act. The stand of the assessee in reply to the show-cause notice was that the return could not be filed because the assessee had share income from the firm, M/s. Bhari Engineering Co., and as the adjustment of the account of the firm took considerable time, there was delay in submitting the return. The explanation was, however, rejected by the ITO who levied a penalty of Rs. 14,420 against the assessee under s. 271(1)(a) of the Act. Aggrieved by the said order, the assessee preferred an appeal before the AAC. The AAC, while rejecting the contention of the assessee that there were sufficient reasons for the delayed filing of the return, accepted the contentions of the assessee that the penalty leviable should have been imposed with reference to the tax which was payable on the date of imposition of the penalty and directed the ITO to compute the penalty accordingly. Aggrieved by the said decision, the Revenue brought the matter by way of appeal before the Tribunal, which, following the dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gued that the assessee's previous year ended on March 31, 1961. The return for the assessment year 1961-62 should have been filed within July 30, 1961. The default, if any, took place when the return was not filed on May 30, 1961. The I.T. Act, 1961, came into force on April 1, 1962. Therefore, the assessee's case would be governed by the substantive law applicable to the accounting year 1960-61. There are several reasons for which we are unable to accept the contention made on behalf of the assessee. For the assessment year 1961-62 the assessee did not file any return of income within the time allowed under s. 22(1) of the Indian I.T. Act, 1922. A notice under s. 148 was served upon the assessee on December 2, 1963. The assessee did not file any return within the time allowed by that notice but it actually filed return belatedly only on April 20, 1964. Hence, a notice under s. 274 read with s. 271 dated March 18, 1966, was issued to the assessee for giving him an opportunity to show cause why penalty under s. 271(1)(a) should not be imposed for the late submission of the return. Section 297(2)(d)(ii) specifically authorises the ITO in respect of any assessment year after the yea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of R. Gopalakrishna Bros v. CIT [1977] 106 ITR 82. In that case, the assessee filed its return for the assessment years 1960-61 and 1961-62 on March 6, 1965, beyond the time-limit fixed by s. 22(1) of the Indian I.T. Act, 1922. For the failure of the assessee to file its return within the time prescribed under s. 22(1), the ITO started proceedings under s. 271(l)(a) of the I.T. Act, 1961, and levied penalty as prescribed by the new Act. The contention of the assessee in that case was that no penalty could be imposed under the provisions of the 1961 Act for the default committed under the Act of 1922. In that case it was held that even in respect of assessments for the assessment years prior to 1962-63, penalty could be levied in accordance with the provisions of the I.T. Act, 1961. It was held that the penalty had to be calculated in accordance with the provisions of s. 271 of the Act of 1961. The same view was taken by the Delhi High Court in the case of CIT v. Maya Rani Punj [1973] 92 ITR 394, by the Rajasthan High Court in the case of CIT v. Venichand Maganlal [1970] 78 ITR 120 (Raj) and also in the case of CIT v. Shankarlal Naraindas [1970] 76 ITR 642 (Raj). In view ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 297(2)(g) has made s. 271 applicable to the case of the assessee even though the default was committed originally under the Act of 1922. Section 271 has been amended and the amendment has been made by a legal fiction effective from April 1, 1962. In the case of CWT v. Suresh Seth [1981] 129 ITR 328 (SC), one of the questions was whether the Tribunal was right in upholding the penalties levied by the Department on the assessee under s. 18(1)(a) of the W.T. Act, 1957, for the assessment years 1964-65 and 1965-66. In that case, the Department's contention was that since the assessee who had to file return after April 1, 1965, for the assessment year 1965-66, had not filed the same till March 13, 1971, penalty had to be computed for the period up to April 1, 1961, under the provisions of s. 18 of the Act as it stood during that period and for the subsequent period, additional penalty should be levied in accordance with the provisions of s. 18 as amended by the Finance Act, 1969. The Supreme Court observed at pp. 338-339 as follows "Section 18 of the Act, with which we are concerned in this case, however, does not require the assessee to file a return during every month aft ..... X X X X Extracts X X X X X X X X Extracts X X X X
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