GUNVANTLAL MANGALDAS Vs. COMMISSIONER OF INCOME TAX GUJARAT

JUDGEMENT

(1.) The same question has been referred by the Tribunal under sec. 66 (1) of the Indian Income Tax Act 1922 (hereinafter referred to as the Act) in each of these three References and we will dispose of them by this common judgment. The interesting question which arises in these three References is as to the effect of the repeal of the Act by the Indian Income Tax Act 1961 (hereinafter referred to as the Act of 1961).

(2.) In Income-Tax Reference No. 26 of 1965 the assessee is an individual and the relevant assessment year is 1962-63. The Income Tax Officer called upon the assessee by a demand notice under sec. 18A(1) dated June 10 1961 to pay advance tax in four equal instalments falling due on June 15 1961 September 15 1961 December 15 1961 and March 15 1962 For the purposes of this judgment the amount which the assessee was called upon to pay is not relevant. The assessee failed to pay the instalment which fall due on December 15 1961 The Income Tax Officer required the assessee to pay immediately the tax instalment which was being demanded and which had remained unpaid and in default of the payment the assessee was asked to treat the letter as a show-cause penalty notice for non-payment of tax on the due date. The assessee neither paid the tax nor appeared before the Income Tax Officer on the due date to explain to him the circumstances. Thereafter on September 15 1962 the Income Tax Officer imposed a penalty on the assessee in the sum of Rs. 3575/under sec. 46(1) read with sec. 18A of the Act. This penalty order was challenged before the Appellate Assistant Commissioner and the appeal was dismissed. Therefore there was a further appeal before the Tribunal and the Tribunal also dismissed the appeal; and thereafter the following question has been referred to us by the Tribunal:-

(3.) In Income Tax Reference No. 21 of 1965 the assessment year was 1962-63. The assessee had been called upon by the demand notice under sec. 18A(1) served on the assessee on May 31 1961 to pay advance tax in four equal instalments payable on June 15 1961 September 15 1961 December 15 1961 and March 15 1962 The first three instalments were paid by the assessee but he failed to pay the last instalment that fell due on March 15 1962 In the case of this assessee also the Income Tax Officer wrote a letter to the assessee asking the assessee to pay immediately the tax demanded and which had remained unpaid and in default to treat the said letter as notice for penalty. The assessee neither paid the tax nor appeared before the Income Tax Officer to explain the circumstances and ultimately the Income Tax Officer imposed the penalty in the sum of Rs. 1160.00under sec. 46(1) of the Act read with sec 18A of the Act. Against the order imposing the penalty the assessee appealed to the Appellate Assistant Commissioner and the appeal failed. There was a further appeal to the Tribunal and the Tribunal also dismissed the appeal and thereafter at the instance of the assessee the same question which has been set out above has been referred under sec. 66(1) of the Act.