ADDITIONAL COMMISSIONER OF INCOME TAX Vs. NATHOOLAL BALARAM

JUDGEMENT

(1.) BY this reference under Section 27(1) of the W.T. Act, 1957 (hereinafter referred to as "the Act"), the Income-tax Appellate Tribunal, Indore Bench, Indore, has referred the following question of law for the opinion of this court :

(2.) THE facts giving rise to this reference as set out in the statement of the case are these : THE return of wealth of the assessee for the assessment year 1970-71 was due on or before September 30, 1970. THE assessee, however, filed the return showing his net wealth at Rs. 1,14,600 on July 7, 1971. THE WTO while finalising the assessment on December 10, 1971, did not pass any order for initiating proceedings for imposition of penalty on the assessee under Section 18(1)(a) of the Act. THE Addl. CWT on a perusal of the order passed by the WTO was of the view that the said order was erroneous and was prejudicial to the interests of the revenue inasmuch as the WTO had failed to initiate penalty proceedings against the respondent. THE Addl. Commissioner, therefore, issued a notice to the assessee to show cause as to why an order be not passed directing the WTO to initiate penalty proceedings against him. After considering the objections of the assessee, the Addl. Commissioner passed an order under Section 25(2) of the Act on September 25, 1973, holding that the order of the WTO was erroneous in so far as it was prejudicial to the interests of the revenue. He, accordingly, set aside the order of the WTO and directed him to make a fresh assessment in accordance with law keeping in view the applicability of the provisions of Section 18(1)(a) of the Act. THE assessee preferred an appeal against the order of the Addl. Commissioner before the Income-tax Appellate Tribunal (hereinafter referred to as " the Tribunal "). THE Tribunal accepted the appeal and held that the order passed by the Addl. Commissioner was bad in law. At the instance of the Addl. Commissioner, the Tribunal has referred the aforesaid question of law for the opinion of this court.

(3.) AS a result of the discussion aforesaid, our answer to the question referred to us is in the negative and against the assessee. In the circumstances of the case, the parties shall bear their own costs of this reference.