Law:

Section:

Section 271, read with section 171 of the Income-tax Act, 1961 [Corresponding to section 28(1) read with section 25A of the Indian Income-tax Act, 1922] - Penalty for non-production of accounts/ concealment of income - Assessment years 1949-50, 1951-52, 1953-54 and 1954-55 - Whether once factual existence of HUF is conceded either directly or indirectly, it is not open to ITO to assess individual members thereof during continuance of such a united family - Held yes - Assessee, who was a member of HUF which was distrupted in 1956, was levied penalty under section 28(1)(b) and (c) for relevant assessment years - It was found that revenue had recognised disruption under section 25A of 1922 Act on 30-12-1961 - Whether in view of order of declaration under section 25A(1) recognising that there was HUF upto 23-4-1956, impugned orders of penalty were not valid - Held, yes FACTS The ITO instituted proceedings against the assessee under section 28(1)( b) so far as the assessment years 1949-50 and 1954-55 were concerned and under section 28(1)(c) for the assessment years 1951-52 and 1953-54 and thereafter imposed penalties. The assessee's case was that the levy of penalty was not justified and that during the assessment years in question the assessee was wrongly assessed in the status of an individual and that he ought to have been assessed in the status of a HUF, and since the HUF became disrupted in 1956, the levy of penalty on the HUF after its disruption was illegal and even the initiation and the conclusion of the proceedings against the assessee as an individual and as if he was liable to pay the penalty would equally be illegal. The assessee relied upon an order of the ITO dated 30-12-1961, under section 25A, by which the revenue was satisfied that there had been a complete partition in the family with effect from 23-4-1956. The applicant was unsuccessful before the AAC and so too before the Tribunal. The Tribunal, however, dealing with the contentions of the assessee, held that, on merits, the levy was justified and on the question of law raised by the assessee it was of the view that the assessee should not be allowed to raise this question as he knew the…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492