Law:

Section:

Section 275 of the Income-tax Act, 1961-Penalty-Limitation for imposition of-Whether amendment in section 275 with effect from 1-4-1971 enlarging period of limitation would apply to pending case as on 1-4-1971-Held, yes Section 166 of the Income-tax Act, 1961-Representative assessee-Direct assessment or recovery not barred-Whether a direct assessment made on minor is bad in law in view of section 166-Held, no Facts The assessee was a minor and, for the assessment year 1965-66, no return of advance tax as required under section 212(3) was filed. The ITO issued notice and after hearing the asses-see imposed a penalty of Rs. 10,000 for this default. The assessee filed an appeal before the Tribunal stating that the penalty order was time barred and that the imposition of penalty on the minor herself was bad in law. The Tribunal, however, dismissed the appeal. On reference: Held 1. The assessment order in the instant case was passed on 2-3-1970. The order imposing the penalty was dated 21-3-1972. With effect from 1-4-1971, section 275 was amended to provide for a period of imitation of two years from the end of the financial year in which the proceedings in the course of which action for imposition of penalty had been initiated, were completed. This amendment was to apply to pending cases also in which the proceedings had not become closed or barred by limitation. In view of this amendment penalty order could have been passed in the assessee's case till 31-3-1972 whereas it was actually passed on 21-3-1972. Hence, the penalty notice was not time barred. 2. Though under section 161 assessment can be made on the representative assessee in respect of minor, yet in view of section 166, a direct assessment can equally be made on the minor. Therefore, there was no merit in the assessee's contention that the imposition of penalty on the minor herself was bad in law. Case review Hargu Charan Srivastava v. CIT [1979] 119 ITR 622 (All.) relied on point 1. Case referred to Hargu Charan Srivastava v. CIT [1979] 119 ITR 622 (All.). Judgment Satish Chandra C.J.-The Tribunal has submitted the statement of case and referred the following two questions of law for our opinion : "1.…

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