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Section 189 of the Income-tax Act, 1961 - Firm - Assessment after dissolution - Assessment year 1959-60 - Whether it was not correct to say that to attract section 189, dissolution of firm and discontinuance of businesses of firm were two necessary ingredients, but provisions were attracted in either case - Held, yes Section 271(1)(a) of the Income-tax Act, 1961 - Penalty - For late filing of return - Assessment year 1959-60 - Tribunal deleted penalty imposed upon assessee under section 271(1)(a) without addressing itself to question as to whether delay in filing return had been or had not been without reasonable cause - Whether, in aforesaid situation, question as to whether Tribunal was right in deleting penalty could not be decided - Held, yes - Whether, therefore, matter was to be remanded to Tribunal to determine as to whether delayed filing of return by assessee was without reasonable cause or not - Held, yes (Matter remanded) FACTS The assessee-firm consisted of two partners. One of the partners, MR, died on 30-5-1958 and the firm was dissolved. The business of the firm was taken over by the two sons of the deceased partner and the surviving partner HM, transferred his rights to them. HM also died in September, 1960. A notice under section 22(2) of the Indian I.T. Act, 1922, was issued against the firm which was served on RK, one of the sons of MR on 11-6-1959. Time for filing the return of the assessee-firm for the assessment year 1959-60, was extended up to 31-10-1959. However, the return was filed by RK on 22-1-1964, and the assessment was completed on 19-3-1964. Penalty for late filing of return was levied on the firm under section 271(1)(a) read with section 189. This was confirmed by the AAC but the Tribunal further held that section 189 was not attracted as the business was not discontinued, on the death of MR and no penalty was leviable as the conduct of RK was not contumacious or dishonest. The Tribunal further held the default on the part of RK, was nothing more than a technical or venial breach of the provisions of the Act, specially when no notice was issued by the department to the surviving partner of the assessee-firm, who was alive till…

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