Law:

Section:

Section 271(1)(a), read with sub-sections (1) and (4) of section 139, of the Income-tax Act, 1961-Penalty-For late filing of return-Assessee filed return beyond time prescribed in section 139(1) but within time allowed under section 139(4)-Whether for purposes of section 271(1)(a ) assessee could be said to have furnished return within time allowed under section 139(1)-Held, on facts, no Facts For the assessment year 1962-63, the assessee filed its return of income on 27-11-1964 as against the due date of 30-8-1962. In the course of the penalty proceedings initiated under section 271(1)(a ) the assessee contended that it had voluntarily filed the return under section 139(4) and hence it had not committed any default under section 271(1)(a). The ITO rejected the contention and imposed penalty under section 271(1)(a). On appeal, the assessee, for the first time, contended that as interest under the proviso to section 139(1) (as it then stood) had been charged from it, no penalty was leviable on it. The AAC rejected the contention and sustained the penalty order. On second appeal, the Tribunal rejected the assessee's contention that charging of interest had resulted in automatic extension of time but it accepted the other contention that no penalty was leviable in view of the observations made by the Supreme Court in the case of CIT v. Kulu Valley Transport Co. (P.) Ltd. [1970] 77 ITR 518. The Tribunal, accordingly, cancelled the penalty. On reference: Held The principle laid down by the Supreme Court in the case of CIT v. Kulu Valley Transport Co. (P.) Ltd. (supra) cannot be extended to the context of section 271(1 )(a). Therefore, it had to be held that the assessee had failed to furnish the return of its income within the time allowed by section 139(1) and thus the Tribunal was wrong in setting aside the penalty order. Case review Addl. CIT v. Bhagat Swamp Charanjit Singh & Co. [1981] 7 Taxman 209 (Delhi) and Chunilal & Bros. v. CIT [1979] 119 ITR 199 (MP) followed. Cases referred to Addl. CIT v. Bhagat Swarup Charanjit Singh & Co. [1982] 133 ITR 13 (Delhi), Chunnilal and Bros. v. CIT [1979] 119 ITR 199 (MP) and CIT v. Kulu Valley Transport Co. (P.)…

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