VALLABHDAS MANJIBHAI DHOLAKIA Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE second and third petitioners are firms registered under the Indian Partnership Act, 1922. The first petitioner is a partner in the said two firms. The said firms carry on the business of building contractors and their principal place of business is in Wadhwan City, District Surendranagar. Between 14th Dec., 1964, and 19th July, 1969, the second petitioner entered into nine separate contracts for construction of buildings with different co operative housing societies. Likewise, between 28th April, 1967, and 24th Aug., 1969, the third petitioner entered into five separate contracts of similar nature with different co operative housing societies. It appears that the value of those contracts exceeded fifty thousand rupees and the concerned petitioner was, therefore, required to furnish to the ITO having jurisdiction to assess it particulars relating to the contracts within one month of the making of the contracts under S. 285A of the IT Act, 1961 (hereinafter referred to as "the Act"). The petitioners, however, failed to furnish the requisite particulars accordingly. In the course of proceedings for assessment to income tax for the asst. yrs. 1965 66 to 1970 71 (in the case of the second petitioner) and asst. yrs. 1968 69 to 1970 71 (in the case of the third petitioner), particulars relating to these various contracts were disclosed by the respective petitioners and assessment orders were passed in due course by the concerned ITO, after taking into account the income derived by the second and third petitioners out of the said contracts.

(2.) ON 28th Dec., 1971, the CIT, Gujarat III, the first respondent herein, issued notices under r. 121 of the IT Rules, 1962, calling upon the second and third petitioners to show cause why penalty or fine should not be imposed upon them under S. 285A of the Act for failure to furnish particulars relating to the abovementioned contracts to the concerned ITO within one month of the making of the contracts. The petitioners showed cause and in due course the first respondent passed orders levying fine in the sums of Rs. 14,660 and Rs. 14,900 respectively on the second and third petitioners for non compliance with the provisions of S. 285A. The petitioners have thereupon filed the present petition under Art. 226 of the Constitution of India challenging the said orders.

(3.) IN order to appreciate the points raised for our determination, it would be necessary to make reference to the relevant statutory provisions. Sec. 285A reads as under: