ADDITIONAL COMMISSIONER OF INCOME TAX Vs. ONKAR SARAN

JUDGEMENT

(1.) THIS a reference under S. 256(1) of the I. T. Act. The assessee is an HUF. It filed returns of income for the asst. yrs. 1961 -62 and 1962 -63 and assessment for the year 1961 -62 was completed on 28th March, 1962, and assessment for the year 1962 -63 was completed on 28th November, 1963. Thereafter, the assessments were reopened under S. 148 r/w S. 147(a) on the ground that a part of the assessee's income had escaped assessment. In response to the notices under S. 148 returns were filed on February 27, 1969, for both the years with the remarks "income as originally filed". The ITO completed the revised assessments and enhanced the income in respect of both the assessment years. Thereafter, he initiated proceedings for the levy of penalty under S. 271(1)(c) of the Act.

(2.) WITH effect from April 1, 1968, the quantum of penalties was increased by amendment in s.271 (1)(c)(iii). The penalties were imposed with reference to the amended provision. The contention of the assessee is that as the original returns were filed long before the amendment came into effect penalties could not be imposed with reference to the amended provisions. The Tribunal has accepted his contention. At the instance of the department, the following question has been referred to us :