Law:

Section:

Section 139 of the Income-tax Act, 1961 - Return of income - General - Assessment year 1967-68 - Whether default of assessee on account of failure to furnish voluntary return under section 139(1) is not condoned in spite of service of notice under section 139(2) - Held, yes Section 271(1)(a), read with section 139, of the Income-tax Act, 1961 - Penalty - For late filing of return - Assessment year 1967-68 - Whether penalty under section 271(1)(a) is leviable even when interest is charged under section 139 - Held, yes FACTS As the assessee did not file the return of income in time, notice under section 139(2) was served on the assessee. The assessee did not pay any heed even to the said notice and filed the return much after the expiry of the period of 30 days mentioned in the same. Thereafter the Income-tax Officer imposed penalty under section 271(1)(a). The appeals, filed by the assessee were dismissed by the AAC and the Tribunal. On reference the assessee contended that the penalty imposed for the default committed under sub-section (1) of section 139, would be deemed to have become ineffective with the issue of notice under sub-section (2) of section 139, and as such, the authorities had no jurisdiction to impose any penalty for not having filed the return under section 139(1). HELD Under sub-section (2) of section 139, an Income-tax Officer has been given the power to serve a notice on a person, who, in his opinion, was assessable under the Act requiring him to furnish within 30 days from the date of the service of the notice a return of his income or the income of such other person during the previous year in the form prescribed and verified in the prescribed manner and setting forth such other particulars as may be prescribed. There is nothing in section 139 to indicate that by the act of service of a notice under sub-section (2) of section 139, a person liable to furnish a return under sub-section (1) is absolved of his duty and the default of having not filed a return under sub-section (1) of section 139, is condoned. The legal consequences of the omission or failure to file the return under sub-section (1) of section 139, as well as that of not…

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