JAKHODIA BROTHERS Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS is a petition under Article 226 of the Constitution for quashing the orders of the Commissioner of Income-tax dated 17th September, 1976 (annexure 25), and the order dated 4th September, 1975 (annexure 18).

(2.) THE petitioner is a partnership concern carrying on business at Kanpur. Assessments for the assessment years 1969-70, 1970-71 and 1971-72, were completed in due course. THE petitioner-firm thereafter filed the returns for the assessment years 1972-73 and 1973-74. THEse assessment proceedings were pending completion. On 24th April, 1974, the petitioner filed a disclosure petition disclosing an amount of Rs. 1,25,000 to be assessed in 5 years from the assessment years 1969-70 to 1973-74 in equal amounts of Rs. 25,000 each. THE application also contained a prayer for waiver of the penalties under Section 271(4A) of the Act. On September 20, 1974, a letter was sent by the Commissioner of Income-tax to the petitioner initimating that the application for waiver having been filed only after the detection by the department, the Commissioner intended to reject the application for waiver. A reply was filed by the petitioner on October 4, 1974, reiterating his request for waiver. On September 4, 1975, the Commissioner of Income-tax rejected the application filed on April 24, 1974, and on October 4, 1974, on the ground that as the question for waiver of penalty could arise only when a show-cause notice for the levy of penalty was issued, the applications filed by the petitioner were not maintainable.

(3.) SECTION 271 deals with failure to furnish returns, comply with notices, concealment of income, etc. The relevant portion of the said section reads :