M N JADHAV Vs. INCOME TAX OFFICER FOURTH

JUDGEMENT

(1.) M. N. Jadhav of Hubli, the original petitioner before me, who is now dead and is represented by his legal representatives, was an assessee under the Income-tax Act, 1961 (Central Act No. 43 of 1961) ("the Act"). For the assessment years 1964-65 and 1965-66, the Inspecting Assistant Commissioner of Income-tax, Hubli exercising powers conferred on him by section 271(1)(c) of the Act, by separate but identical orders made on March 14, 1972, levied a sum of Rs. 6,000 as penalty for each year on the petitioner. Aggrieved by the said orders made by the Inspecting Assistant Commissioner, the petitioner filed appeals before the Income-tax Appellate Tribunal, Bangalore ("the Tribunal"), under section 250 of the Act which by its order dated March 7, 1973, allowed them and cancelled the penalties levied against him. But, on references made at the instance of the Revenue on that question, this court by its order made on April 21, 1978, in I.T.R.C. Nos. 70 and 71 of 1974 answered the same in its favour and against the petitioner. Agreeing with the said order of this court, the Tribunal then disposed of the appeals filed by the petitioner holding that the levy of penalty by the Inspecting Assistant Commissioner was correct and legal. In compliance with the said order of the Tribunal, the IVth Income-tax Officer, Hubli, has passed two consequential orders on February 15, 1979 (annexures "A" and "B"), calling upon the petitioner to pay the balance of penalty and the interest accrued thereon under section 220(2) of the Act. In these petitions under article 226 of the Constitution, the petitioner has challenged the said orders made by the Income-tax Officer in so far as they demand interest on penalty levied by the Inspecting Assistant Commissioner.

(2.) SRI S. G. Shivaram, learned advocate, appeared for the petitioner. SRI G. Sarangan, learned special standing counsel for the Income-tax Department, appeared for the respondents.

(3.) WHEN the Inspecting Assistant Commissioner levied penalties for the two assessment years in conformity with section 156 of the Act, the Income-tax Officer had issued notices of demand to the petitioner and that is not rightly disputed by Sri Shivaram.