Law: Income Tax Act, 1961

Section: 271,271(1),274

[Indian Income-tax Act, 1961].......Sections 271(1), 274-lenalty-Satisfacfaction of Income Tax Officer before conclusion of assessment-Assessment by 0%cer who noted in the assessment proceedings that penalty proceedings were sing taken-Case transferrd to another Officer-Other Officer issuing penalty notice to assessee and forwarding case to Inspecting Assistant Commissioner-Notice to assessee by latter officer-- Whether valid in law-Held yes. The aesesseement of the assessee for the assessment year 1964-65 was completed by the Income-tax officer, A Ward, Jullundhur, on March 18, 1969. Therein it was observed as follows: "Penalty notice under section 274, read with section 271 (1) (c) for concealing true particulars of income has already been issued. Penalty action under section 274 read with section 27 (1) (c) for non-compliance of notice under section 142 (1) or 143 (2) has also been issued." Thereafter, the case of the assessee was transferred to the Income-tax Officer, Central Circle V, Calcutta, who on June 5 1970, issued a notice to the assessee stating that the case for levy of penalty under section 271 (1) (c) was being referred to the Inspecting Assistant Commissioner of income-tax, Range-1(c) of Calcutta. This latter Officer in pursuance of the reference made to to him by the Income- tax Officer, issued notice on February 10, 1971, to the assessee to show cause why penally should not be levied. The assessee filed a writ petition contending that the Inspecting Assistant Commissioner of income-tax (Central), Range I, Calcutta, had no jurisdiction and no authority to issue the imugned notice: Held, that Income-tax Officer was satisfied during the course of the assessment proceeding about the need for imposition of penalty. What is required is the satisfaction before the conclusion of the assessment proceeding and not the issue of any notice or the initiation of any step for imposing penalty. In the notice issued to the assessee by the transferee-Income-tax Officer, the use of the expression "Whereas in the course of proceedings before me for the assessment year 1964-65 it appears to me that you have concealed the particulars of your income or deliberately…

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