Law: Income Tax Act, 1961

Section: 271

Income-tax----Penalty---Concealment of income---Change of law---Jurisdiction of I.A.C. ---Amendment divesting I.A.C. of jurisdiction---Reference to I.A.C. made before amendment ---I.A.C. competent to levy penalty---Indian Income Tax Act, 1961, Ss.271(1)(c) & 274. Where, for the assessment, years 1966-67 and 1971-72, the assessment was completed on March 26, 1976, and reference was made to the Inspecting Assistant Commissioner for the purpose of levy of penalty under section 271(1)(c) of the Income Tax Act, [ 961 on March 26, 1976: Held, that the Inspecting Assistant Commissioner had jurisdiction to levy penalty by order, dated March 27, 1976. CIT v. Smt. R. Sharadamma (1996) 219 ITR 671 (SC) fol. R. Abdul Azeez (R.) v. CIT (1981) 128 ITR 547 (Kar.) ref. JUDGMENT K. A. THANIKKACHALAM, J.---At the instance of the Department, the Tribunal has referred the following question for, the opinion of this Court under section 256(1) of the Income Tax Act, 1961: "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is correct in law in holding that the Inspecting Assistant Commissioner had no jurisdiction to impose the penalty under section 271(1)(c) in this case and accordingly in cancelling the penalty of Rs.26, 404/51 ,553 for the assessment year 1966-67/1971-72?" The point for consideration is whether the Inspecting Assistant Commissioner had jurisdiction to impose penalty under section 271(1 j(c) in this case for the assessment years 1966-67 and 1971-72. The Tribunal relying upon the decision of the Karnataka High Court in the case of R. Abdul Azeez v. CIT (1981) 128 ITR 547, held that there was no jurisdiction on the part of the Inspecting Assistant Commissioner after amendment to levy penalty under section 271(1)(c) of the Act in the present case especially after the amendment to section 274 of…

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