J RASIKLAL AND CO Vs. G K MISHRA

JUDGEMENT

(1.) BY this petition under article 226 of the Constitution of India, the petitioner, a dissolved partnership firm, has challenged the legality and validity of the two orders passed by the commissioner of Income-tax, Bombay City VI, Bombay (both dated August 18, 1987), under sections 264 and 273a of the Income-tax Act.

(2.) THE assessment of the petitioner-company for the assessment year 1983-84 was completed on february 1, 1985. The petitioner, it is stated, had filed its return originally on November 2, 1983. It filed revised return on July 16, 1984. In the revised turn, an additional income of Rs. 3,16,000 was shown. Being of the view that the penal provision of section 271 (1) (c) were attracted, the income-tax Officer recorded a finding to the effect and, after allowing the petitioner an opportunity of being heard imposed, by order dated December 11, 1985, a penalty of Rs. 3,12,840 under section 271 (1) (c), being 150% of the amount of tax sought to be evade. The petition did not file any appeal against the order. Instead, it filed a revision petition before the commissioner of Income-tax under section 264 of the Act. It also made an application before the commissioner under section 273a for reduction or waiver of penalty so imposed by the income-tax officer. By the impugned orders both dated August 18, 1987, the Commissioner rejected the petitioner's revision petition under section 264 as well as the application under section 273a of the Income-tax Act.

(3.) INVITING the Court's attention to the fact that no affidavit-in-reply has been filed by the department, Shri Trivedi, learned counsel for the petitioner, stated that the averment made in the petition remained uncontroverted. Referring then to paragraph 2 of the petition, he pointed out that a search was conducted in the petitioner's premises on June 15, 1982, during which cash of rs. 3,16,000 was found and seized. The raiding party which was headed by a Deputy Director of inspection (Intelligence) told the petitioner that if it offered that amount as the income of the current year, it could avoid levy of penalty. The petitioner was even given a challan for payment of advance tax to be adjusted against the said amount of Rs. 3,16,000 seized by the raiding party. The petitioner is said to have written to the Deputy Director of Inspection (Intelligence) on June 21, 1982, and to the Commissioner of Income-tax on June 22, 1982, admitting the said amount to be its income for the said year and necessary challan for advance tax also stated to have been filed.