Law:

Section:

Section 271(1)(a) of the Income-tax Act, 1961 - Penalty - For late filing of return - Assessment year 1960-61 - Whether expression amount of tax, if any, payable by him' referred to in first part of section 271(1)(a)(i) refers to tax payable under a demand notice - Held, yes - Whether, therefore, in calculating penalty leviable under section 271(1)(a)(i), amount paid by assessee under provisional assessment under section 23B of Indian Income-tax Act, 1922, was to be deducted from amount of tax determined under section 23(2) of that Act in order to determine amount of tax on which computation of penalty was to be based - Held, yes Words and phrases : - Expression 'the amount of tax, if any, payable by him' as occurring in section 271(1)(a)(i). FACTS The ITO issued a notice under section 22(2) of 1922 Act, on 1-6-1960, the same was served on the assessee on 13-6-1960. That notice required the assessee to submit its return on or before 18-7-1960. On 18-7-1960, the assessee moved for extension of time for submitting its return. The ITO extended the time by two months and at the same time, he informed the assessee that no further time would be allowed. The assessee failed to furnish its return within the extended time. Thereafter, a notice under section 28(3) of the 1922 Act was served on the assessee on 16-1-1961. On the very next day, viz., 17-1-1961, the assessee filed its return for the assessment year in question. The assessment was completed by the ITO only on 31-10-1962. Meanwhile, on 1-4-1962, the Income-tax Act, 1961 came into force. As under the provisions of section 297(2)(g) of the 1961 Act, the proceedings for the imposition of the penalty had to be initiated and completed under the 1961 Act, a fresh notice under section 274(1) of the 1961 Act was served on the assessee. The assessee objected to the validity of the notice but that objection was overruled. The ITO determined the tax due from the assessee for the assessment year at Rs. 1,25,512.10 and on that basis, the penalty payable by the assessee was fixed at Rs. 12,734.10. At this stage it may be mentioned that on 2-2-1961, a provisional assessment was made by the ITO under section 23B of the 1922…

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