Law:

Section:

Section 221 of the Income-tax Act, 1961 [Corresponding to section 46(1) of the Income-tax Act, 1922] read with section 73(5) of the Estate Duty Act, 1953 - Collection and recovery of tax - Penalty payable when tax in default - Penalty was imposed penalty dues under section 73(5) of Estate Duty Act, read with section 46(1) of Income-tax Act - Petitioner sought for payment in instalment - As petitioner had failed to pay balance in accordance with instalments granted, certificate officer issued notice under section 7 of Bengal Public Demands Recovery Act and directed payment in accordance with instalments granted-petitioner again defaulted payment - Whether imposition of penalty under Estate Duty Act was independent of certificate proceedings - Held, yes - Whether it was open to department to proceed with either of these proceedings which were not exclusive of each other in scheme of Act - Held, yes FACTS Penalty orders were passed under section 73(5) of the Estate Duty Act 1953, read with section 46(1) of the Indian Income-tax Act, 1922. The petitioner thereafter applied for payments of the dues by instalments and they paid certain instalments between March 1959, and April, 1960. Inasmuch as the petitioner had failed to pay the balance in accordance with the instalments granted, a certificate under the Bengal Public Demands Recovery Act was forwarded. The certificate officer issued notice under section 7 or the Bengal Public Demands Recovery Act on the petitioner. Therefore the certificate officer directed payment of instalment. Payments had been made according to the instalments granted by the certificate officer. But, inasmuch as the duty was outstanding, penalty was imposed because the assessee had defaulted in payment of the dues in accordance with the instalments granted to him as mentioned in paragraph 7 of the petition. Thereafter, two subsequent orders were passed, imposing further penalties. On writ the petitioner contended that when instalments had been granted by the certificate officer under the Bengal Public Demands Recovery Act, he was not 'in default' and could not be considered to be an assessee in default. HELD Section 46 stipulates the time when…

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