VADILAL ICHHACHAND Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS reference raises a very short question of law and it i : 'Whether on the facts and circumstances of the case, the Income -tax Officer can calculate penalty on the basis of the return filed by the assessee on 28th September, 1953, under (c) of the Income -tax Act ?'

(2.) THE facts are that the assessee is a firm and for the assessment year 1953 -54 for which the accounting year was S.Y. 2008 the assessee filed a return showing a total income of Rs. 7,038. This was on the 28th September, 1953. The books of the assessee were examined on the 19th of October, 1953, when the Income -tax Officer discover that the assessee had not disclosed an income of Rs. 17,548. The assessee filed a revised return dated the 18th of October, 1953, on the 19th of October, 1953, declaring his total income to be Rs. 24,528 which included an addition of Rs. 17,548 to the original income returned, namely, Rs. 7,038. The Income -tax authorities came to the conclusion that the income had been deliberately concealed by the assessee in his return dated the 28th of September, 1953, and imposed a penalty on him of Rs. 4,500. Against this decision, the assessee went to the Tribunal and the Tribunal while agreeing with the conclusion of the Income -tax authorities that a penalty was leviable, held that the penalty should be calculated on the basis of the revised return of the 18th of October, 1953, which had been accepted by the Income -tax Officer and which would result in the penalty being nil. The contention of the Income -tax Commissioner is that the penalty should have been calculated on the basis of the return filed by the assessee on the 28th of September, in respect of which he incurred the penalty.

(3.) THE answer to the question, therefore, will be in the affirmative.