Law: Income Tax Act, 1961

Section: 139(1),139(2),139(4),142(1),144,271(1)(2 ),27CC

(a) Income-tax----Offences and prosecution---Failure to file return, in prescribed time--words "Before the assessment is made" in S.139(4) do not extend the time prescribed under S.139(1) or (2) till assessment order is passed--"Discovery" does not tantamount to action taken by issuing notice under S.139(2) or S.142(1) or S.148 or best assessment under S.144--Indian. Income Tax Act, 1961, Ss. 139, 276-CC & 278-E. (b) Income-tax---Offences and prosecution---Firm---Delay in filing return by partners--Partners contending that delay due to failure of managing partner to supply information with regard to share- of partners in income or loss of firm--Partners had full and free access at all times to books of firm---Accounts of firm closed on 31st March of every year---Wilful failure to furnish return in due time---Prosecution of partners valid. The petitioners were partners of a firm. For the assessment year 1988-89, though the partners had deposited advance tax between April 1, 1987 and March 31, 1988, they failed to file their respective returns on or before July 31, 1988, as required by section 139(1) of the Income Tax Act, 1961. The petitioners filed their returns on March 20, 1991, and the assessment was completed on August 26, 1991. Penalty proceedings were initiated against each of the petitioners and penalty was imposed on them under section 271(1)(a) of the Act. The Commissioner (Appeals) dismissed the appeals filed by the petitioners. Thereafter, notices to show cause under section 276-CC of the Act were issued to the petitioners to show cause as to why proceedings under the section should not be initiated against them. The petitioners contended that the delay, in filing the returns for the assessment year 1988-89 was due to the fact that the firm in which each of them had a 20 per cent. share in the profits had not intimated his or her share in the firm till the date he or she filed his or her return of income, that the firm filed its return of income only on September 17, 1991, and that there was no deliberate or wilful attempt on their part to withhold the return of income. The Commissioner of Income-tax launched prosecution proceedings against them.…

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