Law:

Section:

Section 271(1), read with section 139, of the Income-tax Act, 1961 - Penalty - For concealment of income - Whether where an assessee who was bound to disclose his real total income in return filed by him under section 139 failed to do so, offence of concealment or furnishing of inaccurate particulars with respect to his income in that return became complete - Held, yes - Whether in regard to commission or completion of offence of concealment or furnishing of inaccurate particulars of income withrespect to return filed by assessee under section 139, his persistence in concealing his income or his persistence in furnishing incorrect particulars with respect to his income chargeable to tax would not constitute fresh causes of action or repetition of offence - Held, yes - Whether penalty proceedings have to be completed in accordance with provisions of section 271 as it stood at time when assessee filed original return under section 139 - Held, yes Facts The assessee, a registered firm, filed a return on 31-12-1965 for the assessment year 1965-66. The assessment was completed at a higher amount. Subsequently, investigations made by the ITO revealed that certain credits in the books of account of the assessee represented the income of the assessee itself. The ITO, therefore, initiated reassessment proceedings under section 147. The assessee filed a revised return on 5-1-1970, showing an income which was the total income assessed by the ITO. After agreeing to the addition of the cash credits found by the ITO, the assessee again filed a return adding the said cash credits to the income as per the original return. The ITO completed the assessment while adding the cash credits to the originally assessed income. The ITO had, prior to the passing of the revised assessment order, initiated penalty proceedings and referred the matter to the IAC, who imposed a certain amount of penalty on the assessee. On appeal, the Tribunal granted some relief and directed the ITO to rework the quantum of penalty with respect to the tax avoided, i.e., with respect to the liability as it stood in 1965. On reference, the department contended that section 271(1) as it stood on 5-1-1970, after…

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