Law:

Section:

SECTION 271(1)(c ) OF THE INCOME-TAX ACT, 1961 - PENALTY - FOR CONCEALMENT OF INCOME - ASSESSES FILED HIS ORIGINAL RETURN FOR ASSESSMENT YEAR 1961-62 AND ASSESSMENT WAS COMPLETED IN 1962 - SUBSEQUENTLY, IN REASSESSMENT PROCEEDINGS UNDER SECTION 147(a) INITIATED IN 1970, SOME AMOUNT WAS ADDED TO ASSESSEE'S INCOME AND IN RELATED PROCEEDINGS, PENALTY FOR CONCEALMENT WAS ALSO IMPOSED UNDER SECTION 271(1)(c ) - WHETHER QUANTUM OF PENALTY WAS TO BE COMPUTED WITH REFERENCE TO LAW AS IT STOOD AT TIME OF FILING ORIGINAL RETURN, I.E., PRIOR TO AMENDMENT OF SECTION 271(1)(c ) IN 1968, AND NOT AS PER AMENDED PROVISIONS PREVAILING IN 1970 - HELD, ON FACTS, YES Facts For the assessment year 1961-62, the original assessment of the assessee was completed in 1962 on the basis of a return filed by him. Subsequently, some deposits with a firm made in his wife's name were discovered and a protective assessment for the same assessment year was made on him in 1966. Thereafter, in response to a notice issued under section 148 in 1970, the assessee filed a return on 25-5-1970, showing the same income as in the original return. Subsequently, on 8-1-1971, he filed a revised return including therein the sum already taxed in his wife's hands protectively. The ITO completed the reassessment by adding the sum so disclosed to the assessee's originally disclosed income. In the consequential penalty proceedings, the ITO imposed penalty, computing its quantum as per the provisions of section 271(1)(c) as they stood after their amendment in 1968. The Tribunal upheld the levy of penalty but held that it should be calculated in accordance with the law as it stood prior to the 1968 amendment, as the concealment had taken place in the original return. On reference: Held A notice under section 147(a ) could only be issued on the basis of a previous concealment. The concealment was in the return filed in 1962, on the basis of which the notice was issued. It would follow that the penalty had also to be imposed for the same concealment concerning which the notice was issued under section 147(a). The assessee had filed a return showing the same income in 1970, on the basis that the disputed income had to…

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