RADHA RUKMANI AMMAL Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE question referred to this Court under section 66(1) of the Income -tax Act arose out of the assessment proceedings for the assessment year 1944 -45. The assessee was the Hindu undivided family, which consisted of Subbarayulu Chettiar and his sons. After the death of Subbarayulu Chettiar on 18th February, 1944, that undivided family, of which he had been the karta, consisted of his two minor sons with their mother Radharukmani Ammal as their guardian. The account year ended only on 13th April, 1944, that is, after the death of Subbarayulu Chettiar. For the assessment year 1944 -45 notice under section 22(2) of the Act was issued to the assessee, at that stage represented by Radharukmani Ammal as the guardian of the minor coparceners. It was she who submitted the return on behalf of the assessee on 11th December, 1944. That return was based on the accounts maintained during most of the year of account by Subbarayulu Chettiar. That return was accepted as substantially correct, and the assessment was completed on 31st December, 1944 Subsequently the Income -tax Officer came to know that some of the entries in the account books were fictitious and that some deposits in the Mannargudi Urban Bank were not shown in the accounts of the family, that is, the accounts maintained by Subbarayulu Chettiar. A notice under section 34 was issued on 14th December, 1949, and Radharukmani Ammal again filed a return, in which she repeated the entries she had made in the return filed earlier on 11th December, 1944. On 31st October, 1949, the assessment was revised by the Income -tax Officer, but the enhancement of the assessable income was reduced to some extent on appeal by the Appellate Assistant Commissioner

(2.) IN the course of the reassessment, a notice under section 28(1)(c) was issued to the assessee represented by Radharukmani Ammal, and the assessee was asked to show cause why a penalty should not be imposed. Eventually the Income -tax Officer levied a penalty of Rs. 5, 000, which was confirmed on appeal by the Appellate Assistant Commissioner and, on further appeal, by the Tribunal. It was with reference to these proceedings under section 28 of the Act that the Tribunal referred the following question to this Court under section 66(1) of the Act"Whether on the facts and in the circumstances of the case, the penalty under section 28(1)(c) of the Income -tax Act has been validly imposed on the assessee ?" In its order on appeal the Tribunal observed

(3.) THE Tribunal, it should be remembered, confirmed the order of the Appellate Assistant Commissioner. The findings of the Appellate Assistant Commissioner were more explicit, and the Tribunal did not dissent from any of these findings In paragraph 3 of his order, the Appellate Assistant Commissioner recorded