COMMISSIONER OF INCOME TAX Vs. ABDUL RAHIMAN SAIT

JUDGEMENT

(1.) ABDUL Ralnman Sait is the heir of one Mohammed Jaffer Hussain Sait, who died on 6-5-1952. The deceased had earlier filed returns for the assessment year 1950-51 on 2-3-1951, and for the assessment year 1951-52 on 28-2-1952. Because of his death the assessment for 1950-51 was made on bis son, on 31-12-1954 and for 1951-52 on 18-2-1955. The tax for the first assessment year had amounted to Rs. 1,47,577-15-0 and was to be payable in three equal instalments on January 21, February 25, and March 28, 1955. Similarly the tax for the other assessment year had come to Rs. 53,810-13-0 and was to be realised by two equal instalments on March 30, and April 30, 1955.

(2.) IN this reference we are, however, concerned with legality of the order imposing penalties for the INcome-tax Officer had on 8-9-1955, imposed on the son the further penalties of Rs. 5,000 on ac- count of his failure to pay the tax for the first, and Rs. 3,000 for the failure to pay the tax for the second assessment year. The son appealed to the Appellate Assistant Commissioner, but failed. Thereafter the Appellate Tribunal has allowed the appeal on the ground that the penalties under Section 46(1.) of the INcome-tax Act cannot be levied against the heirs of the deceased assessee. IN support of this view the Tribunal has relied on E. Alfred v. Additional I. T. Officer Circle I, Salem, 1956-29 ITR 708: (AIR 1956 Mad 517) which is conceded to be the only case law on the point. The Department asked & the following question has been thereafter referred:

(3.) WE would now summarise the grounds because of which we think the penalty cannot be levied against the heir of the deceased assessee. The Income-tax Act has not made the liability o the heirs as wide as that of the deceased, nor it has extended all its provisions to such persons, and therefore penal provisions for enforcing the assessee's obligation cannot reasonably be construed as extending to such person. Section 29 distinguishes assessee from other persons who are liable to pay, and that difference extends to Sections 45 and 46, because the three sections are interlocked, with the result that in the context the word 'assessee' in Section 46 does not cover the other person who is liable to pay.