COMMISSIONER OF INCOME TAX Vs. R HARIKRISHNA NADAR

JUDGEMENT

(1.) IN compliance with the orders of this court dated November 2, 1981, the Tribunal referred the following question of law said to arise out of the order of the Tribunal under section 256(2) of the INcome-tax Act, 1961, for our opinion."Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was within its powers in setting aside the penalty order passed by the INspecting Assistant Commissioner under section 271(1)(c) for the assessment year 1972-73 and restoring the matter to the INspecting Assistant Commissioner for fresh consideration after the disposal of the assessment appeal by the Appellate Assistant Commissioner?" The assessee is an individual. For the assessment year 1972-73, in the assessment there were additions of Rs. 59, 650 as understatement of cost of construction of a building and Rs. 20, 000 as unexplained cash credit. Proceedings under section 271(1)(c) of the Act were initiated for levy of penalty. The matter was referred to the INspecting Assistant Commissioner. While the matter was pending before the INspecting Assistant Commissioner, the assessee had filed an appeal in the matter of determining the quantum. The Appellate Tribunal restored the matter to the Appellate Assistant Commissioner for investigating the cash credit of Rs. 20, 000, while reducing the addition for understatement of the cost of construction to Rs. 29, 150. Before the matter could be considered and disposed of by the Appellate Assistant Commissioner, the INspecting Assistant Commissioner held that there was suppression of investment and imposed a penalty of Rs. 49, 750. On appeal, the Tribunal found that while there was enough time for making the penalty order, the disposal of the penalty proceedings without waiting for the completion of the assessment proceedings, which was pending on appeal appeared to be premature. The Tribunal, therefore, deemed it fit to set aside the order of the INspecting Assistant Commissioner and restored the matter to him for fresh consideration in accordance with law, after the appeal was disposed of by the Appellate Assistant CommissionerINasmuch as, in the matter of levy of penalty, the Tribunal has remitted back the issue for fresh consideration and disposal, we consider that there is no infirmity in the order passed by the Tribunal. Accordingly, we answer the question referred to us in the affirmative against the Department, with costs of Rs. 500.