COMMISSIONER OF INCOME TAX Vs. AJAIPAT SINGHANIA

JUDGEMENT

(1.) THESE are six, references under Section 256(1) of the Income-tax Act, 1961 (hereinafter called "the 1961 Act"), at the instance of the Commissioner of Income-tax. The Tribunal has referred a common question of law :

(2.) THE overall pattern of facts and circumstances in all these cases in this : THE assesses were assessed to tax for various years before the assessment year 1960-61. During assessment proceedings it appeared that they were liable to pay advance tax under Section 18A(3) of the Indian Income-tax Act, 1922 (hereinafter called "the 1922 Act "). But they had not paid the advance tax. So proceedings were initiated against them under Section 273(b) of the 1961 Act. THE assessees contended that no penalty could be imposed on them under Section 273(b). THE Income-tax Officer rejected the contention and levied a penalty on them. Figures of penalty are different in different cases. THE assessees then appealed to the Appellate Assistant Commissioner. THE appellate authority accepted the contention of the assessees that no penalty could be imposed under Section 273(b). So the appeals were allowed. THE department then filed an appeal to the Tribunal. THE Tribunal agreed with the view of the appellate authority.

(3.) WE are taking a view which is different from the view of the Division Bench in H.G. Misra and Company's case. But we are relieved from the task of referring the references to a larger Bench because there is already a decision of the Supreme Court on the point in Commissioner of Income-tax v. Singh Engineering Works P. Ltd., [1970] 78 I.T.R. 50 (S.C.) The Supreme Court has held that imposition of penalty under Section 18A(9) may be made under Section 273(b) by virtue of Section 297(2)(g). WE have, however, dealt with the argument of counsel for the assessees because he submitted that the aspect which he has presented to us has not been considered by the Supreme Court. The decision of the Supreme Court does not expressly deal with the aspect presented to us. But nevertheless the decision of the Supreme Court is binding on us. However, we have considered the aspect presented to us and have already come to the conclusion that there is no force in the argument.