PROGRESSIVE ENGINEERING CO Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) THE question that arises in these writ petitions is whether the petitioner is liable to pay interest on the income-tax when he has not voluntarily filed the returns but filed them on receipt of a notice served upon him under Section 148 of the Income-tax Act (hereinafter referred to as " the Act") by the Income-tax Officer.

(2.) THE facts necessary for determination of the question involved are these: THE petitioner is a partnership firm known as M/s. Progressive Engineering Company, Gudivada,'represented by its managing partner. THE petitioner-firm did not file returns for the assessment years 1968-69 and 1969-70 within the time allowed under Section 139(1) of the Act. THE Income-tax Officer issued a notice under Section 148 of the Act stating that the income chargeable to tax for the assessment years in question has escaped assessment within the meaning of Section 147 of the Act. THE petitioner-firm was asked to submit returns for the said two years within 30 days from the date of receipt of the notice. THE petitioner then filed returns for both the assessment years on January 16, 1971, and the Income-tax Officer completed the assessment on January 29, 1971, and charged interest of Rs. 5,256 for the assessment year 1968-69 and Rs. 5,059 for the assessment year 1969-70 on the tax assessed. THE petitioner then went up in appeal unsuccessfully against the levy of interest. THE Appellate Assistant Commissioner dismissed the appeal on the ground that the firm had no right of appeal against the levy of interest under Section 139(1) of the Act. It is the dismissal of the appeals by the Appellate Assistant Commissioner that has led to the filing of the writ petitions.

(3.) CLAUSE (iii) of the proviso to Section 139(1) reads: