GOPICHAND SARJU PRASAD Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS is a reference under section 256 (1) of the Income-tax Act, 1961, at the instance of the assessee M/s. Gopichand Sirjuprasad. The question which the Tribunal has propounded before us for decision is: -

(2.) THE materia] facts are that for the assessment year 1959-1960 the assessee filed a return of its income under section 22 (2) of the Income-tax Act, 1922, on 21st October 1959 showing an income of Rs. 7,896. THE assessee took forest contracts. It ran a saw mill and also manufactured and sold furniture. It also did stone quarrying business. In the assessment proceedings the Income- tax Officer noticed some discrepancies in the accounts and registers maintained by the assessee of its business and called upon the assessee to explain the discrepancies and furnish certain particulars. THEreupon, the assessee filed a revised return of its income on 17th January 1964 disclosing its total income as Rs. 50,605. THE Income-tax Officer finalized the assessment on 19th March 1964 on a total income of Rs. 84,475 after taking into consideration the revised return and issued a notice to the assessee under section 271 (i) (c) of the 1961 Act for concealment of income. As the minimum penalty imposable on the assessee exceeded Rs. 1,000 the Income-tax Officer referred the matter to the Inspecting Assistant Commissioner of Income-tax under section 274 of the Act.

(3.) IT is no doubt true that the assessment against the assessee was by virtue of section 297 (2) (a) under the 1922 Act; but clause (g) of section 297 (2) specifically provides that any proceeding for the imposition of a penalty in respect of any assessment for the year ending on 31st March 1962, or any earlier year, which is completed after 1st April 1962 may be initiated and any such penalty may be imposed under the Act of 1961. The decisions of this Court in Kishanlal v. Commissioner of Income-tax, (1967) 64 ITR 285 and Commissioner of Income-tax, M. P. v. Champalal, 1969 MPLJ 41, leave no doubt that in the case before us penalty proceedings were validly taken against the assessee under section 271 of the 1961-Act.